by Ellen Foell, Esq., Heartbeat International Legal Counsel
From On the LeaderBoard Volume 1, Issue 2
When was the last time your Board actually looked at your center’s Articles of Incorporation or, more to the point, rethought the issue of whether your center should be organized as a 501(c)(3) religious nonprofit corporation, rather than a charitable nonprofit corporation? I venture to guess that after your center was first organized, the paperwork for the Internal Revenue Service was submitted, accepted, 501(c)(3) status given, the letters locked away in a drawer and no one has seen them since. It may be time to take that letter out of the drawer, as well as the Articles and by laws, and rethink your center’s status with the IRS.
Most centers are not set up as religious organizations and indeed, there’s nothing that mandates it. Many centers typically cite the ability to receive grants as the primary reason for the charitable status. However, in today’s political and cultural climate, the charitable designation chosen by most centers, versus the religious designation, may not be as effective for achieving the goals of your center. In fact, because of the ever-increasing attempts of the proabortionists to shut down pregnancy care centers by any means, your center’s lack of religious status may expose your center to problems.
Some very useful benefits flow to a center that’s established as a religious corporation. Federal law permits a religious organization to inquire about an applicant’s religious beliefs in hiring for all positions. Most of the federal nondiscrimination laws don’t apply in hiring. Many states exempt religious organizations from employment discrimination laws. Finally, the First Amendment’s constitutional protection would flow to a center with regard to communications. In the next On the LeaderBoard article, we’ll examine this option further. For now, take the time to start to rethink the issue.
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