Renting your facility to another organization should be done with eyes wide open.
While sharing your facility can be a productive experience, there are also risks every organization should be aware of:
Churches with mortgages may have to pay federal income tax on rental income, depending on how much is earned.
Property tax exemptions can be lost or reduced if churches lease their building or property (even part of it) to commercial entities. This includes uses as minor as food trucks paying churches to lease space in their parking lots.
Churches can be vulnerable to accusations of discrimination if they open their facilities to some, but not all, outside groups. This risk can be reduced by creating facility-use policies, bylaws and clear doctrinal statements.
Learn about other pitfalls to avoid and how to make the most of a facility partnership in this webinar.
Our Expert
MAX HERR
Max Herr is president of Church & Ministry Compliance Consulting. He has more than 25 years of experience in insurance, financial services, compliance and governance, including more than 10 years as a church treasurer. Max served as a church compliance specialist for the California Southern Baptist Convention for six years.
