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Property Tax Exemption and Rental of Church Facilities

Church facilities are tax exempt when rented to another nonprofit corporation, court rules.


• Does a church-owned building lose its property tax exemption when it is rented to another charitable organization? No, concluded an Illinois appeals court. A Lutheran church owned a 3-story building that no longer was used for religious purposes. The church chose to rent the building rather than sell it, since it hoped to utilize the property for religious purposes in the future. Accordingly, it rented the building to a nonprofit dance school that conducted dance lessons and performances. The church received $14,400 in rent in 1986. A tax assessor claimed that the building was no entitled to an exemption from property taxation. A trial court rejected the assessor's position, and the case was appealed. The appeals court acknowledged that the "burden of proving the right to an exemption is upon the person seeking it," and that "in determining whether property is included within the ...

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  • May 1, 1992

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