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26 Nonprofit & Voluntary Sector Q. 5 (1997)

handle is hein.journals/npvolsq26 and id is 1 raw text is: 


Taxing Nonprofits

Carl  Milofsky
Bucknell University

Recently, someone wrote to the ARNOVA Listserve   (the computer bulletin
board of our parent association) about a piece of state legislation that would
make  it easier for nonprofits to be taxed by localities. After the usual fusillade
of concerned statements about the declining condition of nonprofit organiza-
tions, someone wrote suggesting that members of the listserve should begin a
letter-writing campaign in an effort to convince legislators not to pass the bill.
Although  all of this seems reasonable enough given that audience of re-
searchers and practitioners devoted to nonprofit organizations, it brought me
up short because it showed how overtly members of this community present
themselves as lobbyists for the nonprofit organizations' cause.
   I do not mean to present myself as some ivory tower intellectual who is
above politics. My problem, rather, comes from a discussion that arose within
our local Nonprofit Assistance Center (NAC) on this topic. Readers may or
may  not know that Pennsylvania, where I live, is a national leader in auditing
and taxing nonprofits. I had been talking with an attorney who, as a parent
associated with a local private school, was asked to help respond to a $19,000
tax bill that this little school with 50 students and a $100,000 annual budget
had received from the local tax assessor. A free-lance auditor had approached
the local public school district suggesting that he assess every corporate entity
in town for back taxes owed on a business privilege tax on gross revenues
allowed by the Commonwealth.   Challenges to these assessments would be
heard in local courts, and the lack of clear precedents at either the local or state
level meant the results of a court challenge were unclear. My attorney friend
asked if I knew anybody  at the state level who could tell him how other
nonprofits had responded to such assessment efforts. Helping him out seemed
like a good project for our NAC, and at our next meeting of the coordinating
committee  I brought this up, suggesting that this might also be a good way
of drumming   up business for our fledgling operation because many small
nonprofits in our area would  no doubt  be severely taxed-OK,   severely
challenged--by similar assessments.
Nonprofit and Voluntary Secter Quarterly, vol. 26, no. 1, March 1997 5-10
0 1997 Sage Publications, Inc.

from the SAGE Social Science Collections. All Rights Reserved.

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