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D.C. Statute Jeopardizes Churches' Tax-Exempt Status

A court recently upheld this statute.


• In a truly remarkable case, a District of Columbia court of appeals upheld the validity of a statute that jeopardizes the tax-exempt status of every church in the District of Columbia. Here are the facts. Several years ago, the United States Congress enacted a law (as part of the District of Columbia Code) that specifies: "Upon the dissolution of any society or congregation the estate and property of such society or congregation shall revert back to the persons, their heirs, and assigns who may have given or contributed to the purchase of or payment for the same, according to their respective rights." D.C. Code § 29-911. A church's members voted to dissolve the church. The church's assets were sold for nearly $1 million. The church's members adopted a plan for distributing the $1 million among themselves. In an attempt to stop this distribution, 2 of the church's 6 trustees filed ...

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  • November 1, 1991

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