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Tax Exemption of Church Parking Lots

A Texas court recently addressed this issue.


Are church parking lots exempt from property taxes?

Not if they are leased to a commercial business during the week, said a Texas state appeals court. A Baptist church leased two of its parking lots to a neighboring real estate company. The lease provided that the company could use 407 of the 447 parking spaces on the two lots from 7:30 AM to 5:00 PM Monday through Friday. The church reserved 40 parking spaces for its own use during the week, and also reserved the right to use the lots after 5:00 PM each week day and all day on Saturday and Sunday.

The lease specified that the company, and not the church, was responsible for upkeep and maintenance of both lots. The company paid a rental fee of $275 per parking space per year, for a total annual rental fee on all 407 leased spaces of $111,925. The church applied for a property tax exemption on the two parking lots, but its application was denied ...

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  • September 2, 1991

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