Catholic Worker banking: a question and some answers
The Question
Dear Catholic Workers and friends,
The Saints Francis & Therese Catholic Worker community was founded in 1986. We did not want to be tax exempt and we did not want to receive any interest, so we opened an non-interest bearing checking account under the name “SS. Francis & Therese Catholic Worker.” Our bank called the account a club account and took my name and two other members of our community as signatories. For the past 15 years, my wife Claire and I have filed a tax return listing our personal income (from free-lance writing and public speaking) and have attached a letter on house stationary telling the IRS that our personal income was deposited in our house account and that we live and work in the Saints Francis & Therese Catholic Worker along with our four children, we do not receive salaries, but do have room and board which come out of private donations to our community. We also reported to the IRS how much was income was donated to our community and deposited in that account and how many people were sheltered each year with those donations. The IRS never audited us or even asked us any questions.
Unfortunately, the manager of our bank called today and told me that our checking account was going to be closed in two weeks because it is no longer legal to have an account under a group name unless that account is a business account with a tax number different from my social security number. I called the IRS to ask them about this and a very nice woman listened to me explaining the Catholic Worker philosophy and our desire not to be tax exempt status or to receive interest. She suggested that we file to become a non-profit organization without tax exempt status, and I quoted Peter Maurin that the Catholic Worker is an organism not an organization. She dutifully referred to our community for the rest of the conversation as an organism. She told me that there was a form of nonprofit status that was not tax exempt, but admitted that it required considerably more documentation than we currently keep. She suggested that I talk to an accountant or tax attorney. I know neither.
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