[WSBARP] Property Tax Exemption When Lease to Church?

[John J. Sullivan]

Thanks Craig. 

Sent from my iPad

> On May 11, 2021, at 5:31 AM, Craig Gourley <craig at glgmail.com> wrote:
> 
> 
> Hi John, I am dealing with that right now. I have not seen the paperwork from the county for the exemption but my client leases to a church for a school and they are exempt. They have a triple net lease. In fact they were granted retroactive status and got a refund. I am involved because the church wants to keep the refund that the landlord paid while the church was in degault during covid. 
> 
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> From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com> on behalf of John J. Sullivan, Esq. <sullaw at comcast.net>
> Sent: Monday, May 10, 2021 11:26:39 PM
> To: 'WSBA Real Property Listserv' <wsbarp at lists.wsbarppt.com>; wsbarp-owner at lists.wsbarppt.com <wsbarp-owner at lists.wsbarppt.com>
> Subject: [WSBARP] Property Tax Exemption When Lease to Church?
>  
> Listmates:
>  
> Any real property tax gurus out there, or tax exempt types who have dealt with property tax issues?
>  
> Here’s the hypothetical: Landlord who is a non-exempt LLC wishes to lease a building to a church for use in its church operations. Clearly if the church owned the property and used it as a church it would be exempt from real property tax. Everything I’ve seen before indicates a non-exempt landlord leasing to a church does not get the exemption. 
> 
> But I was shown a form for applying for the exemption that contains this language:
>  
> “Generally, ownership by a nonprofit entity is required to qualify for exemption. However, some statutes allow nonprofit organizations to lease property and remain eligible for exemption. In these cases the lease must transfer the responsibility for the property taxes to the nonprofit.”
> 
> Has anyone dealt with this? What does it even mean? How can you transfer responsibility to someone who isn’t responsible? Will a standard triple net lease work?
> 
> Any ideas?
>  
> John J. Sullivan
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