Key point. The operation of a coffee shop as a church outreach to the community will not constitute a basis for tax-exempt status if the operation of the coffee shop is overly commercialized to the extent that the religious purpose is minimal.
The IRS ruled that a "coffee shop" founded by the pastor of a church for personal evangelism in an urban area did not qualify for tax-exempt status since it was indistinguishable in operation from secular, for-profit coffee shops. A nonprofit corporation (the "Corporation") was formed for the following four purposes:
- Proclaim earnestly the gospel message and to urge its personal acceptance.
- Promote prayer, Bible study, missions, Christian fellowship, evangelism, Christian service and encouraging, in every possible way, a lifetime commitment to Christ.
- Provide a forum in which the Gospel of Jesus Christ can be discussed with non-believers outside of a formal church setting.