November 25, 2008

A Tax Question

The annual letter requesting donations for the publication of Trinity arrived in the mail yesterday. Trinity has been the magazine of the Episcopal Diocese of Pittsburgh. It has been published six times a year and sent free to the homes of Pittsburgh Episcopalians. (Most laypeople in the diocese have never seen or heard of Episcopal Life.) I have responded with a donation to this solicitation in the past, but I have not done so in recent years, during which the magazine has been transformed from one about the diocese and Episcopal Church to one about Bishop Robert Duncan and his marvelous deeds and plans.

As usual, the letter was from Bishop Duncan, of the “Episcopal Diocese of Pittsburgh,” which is to say, those folks currently in control of most of the assets recently “liberated” by extra-canonical means from The Episcopal Church. (How long, I wonder, will I remain on this mailing list?) The letter seemed pretty much like those of previous years; it did not suggest that anything as remarkable as “realignment” might have happened recently.

Like most letters from charitable nonprofits, the letter emphasized that donations are tax-deductible. But are they really?

In the wake of the diocesan convention’s voting October 4 to leave The Episcopal Church and join the Anglican Province of the Southern Cone, it didn’t take long to determine which entity thereafter claiming to be the “Episcopal Diocese of Pittsburgh” legitimately represented a diocese of The Episcopal Church. Recall that, at the time of the convention, the diocese had no bishop, as Duncan had already been deposed. Ecclesiastical authority was therefore held by the Standing Committee. All but one member of the Standing Committee announced their departure for the Southern Cone, so the remaining Standing Committee member, namely, the Rev. Jim Simons, represented organizational continuity with the Episcopal Church diocese called the Diocese of Pittsburgh. On October 9, the Presiding Bishop acknowledged that Simons’ Standing Committee was indeed the ecclesiastical authority of the Episcopal Church diocese.

But what about the other guys? Whatever Duncan’s “diocese” is, no one, especially Duncan himself, has suggested that it is part of The Episcopal Church. Although Duncan registered a Pennsylvania nonprofit corporation called “Episcopal Diocese of Pittsburgh” earlier this year—see “Which Episcopal Diocese of Pittsburgh?”—he has claimed not to have transferred any assets to the new corporation and has not, as far as I know, received a determination from the IRS that it is a 501(c)(3) tax-exempt entity. I assume—admittedly without definitive evidence—that Duncan, who has emphasized the continuity of leadership among the realigners, is using the same tax ID the diocese has always used.

Therein lies a problem. The diocese seems never to have had a tax exemption of its own, but has used that of The Episcopal Church. Charities are listed on the IRS Web site, and the church appears there as “Episcopal Churches & Dioceses in the U. S. & Inst. Thereof.” It is associated with Deductibility Code 1, explained as follows: “Generally, a central organization holding a group exemption letter, whose subordinate units covered by the group exemption are also included as having contributions deductible, even though they are not separately listed.” If Duncan’s group is using this as the basis of its tax-exempt status, one has to question on what basis this is possible.

Perhaps there is another tax-exempt organization through which Duncan’s group might claim to be tax-exempt. There is an entry for the “Network of Anglican Communion Dioceses and Parishes,” for example, but I was unable to find any listing for, say, “Episcopal Diocese of Pittsburgh” or for any name containing “Southern Cone.” One could argue, I suppose, that the realigners are part of the Network, though one could point out that the Episcopal diocese joined the Network and that that diocese is not what Duncan heads. But, of course, my former bishop resides in the Anglican Neighborhood of Make-Believe. I think the IRS resides elsewhere.

Perhaps Duncan can validly claim that contributions to Trinity are deductible. Perhaps the Trinity letter is not actually a fraudulent solicitation, but neither does it seem a transparent one. Would you feel confident that your donation to Duncan’s magazine could be deducted on your income tax return? If so, you are more trusting than I.

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