Page 6 - MFMJan 2016
P. 6

And the Tax Man Cometh Again

   This is urgent information for Lodges                5. Letter explaining how the organization is
            that own real property                      specifically using the real property. For example,
                                                        offices for organization, housing for low income,
  Just when you think you’ve got everything covered     church, parsonage, etc.
something else pops up. It’s sort of like playing
“Whack a Mole”. As you will recall, we spent a            In addition, you will need to complete the Form
considerable amount of time getting everything          AB-30R. We have included a sample Form AB-30R
squared away with the Internal Revenue Service and      for your reference. There is a fee associated with
Form 990 filings. For most Lodges, it was an easy       this exemption filing. The fee is $25 for properties
process with the ability to just file an annual online  with structures and $15 for vacant land. If your
990-N postcard. We’ve had that issue behind us for      total annual gross receipts, per IRS Form 990 or
a while.                                                990-N, are under $5,000 the fee is $0. Although
                                                        the application form does not address it, the news
  Now, the Montana Department of Revenue is             articles states that non-profits need to submit a copy
getting into the picture. With the last legislature,    of their Form 990 so that the Montana Department of
the Department of Revenue was tasked with               Revenue can verify gross receipts. I would assume
renewing property tax exemptions. By way of some        that would only apply if you are claiming that gross
background, the counties used to handle all property    receipts are under $5,000 in order to avoid paying
tax assessments and exemptions. In the early 1980’s     the fee.
this function was transferred to the state, which
keeps a complete tax record of all real property.         After the exemption application is reviewed by
At that time, the record of all exempt property was     the Department of Revenue, you will be sent a
transferred as well. However, some of those records     letter stating either the approval or denial of the
go back to statehood and many have not been vetted      exemption. If you rent or lease any part of your
in years. That brings us to where we are today.         Lodge building to anyone who uses it for business
                                                        or profit making purposes, you will generally not be
  The state is reviewing and renewing the exempt        granted an exemption from property taxes.
property records. All non-profit organizations that
own real property will need to complete a new Real        Remember, this application for exemption only
Property Tax Exemption Application, Form AB-            applies to Lodges that own real property. If your
30R by March 1, 2016 in order to have their real        lodge rents or shares property, you are not required
property exempt from property tax.                      to file.

  This is going to take some effort. You will need to     Also, we would like to point out that all temple
have and include:                                       associations will be required to file as well. If the
1. Articles of incorporation (if incorporated) or       temple association has its own Federal ID number
constitution and bylaws (if not incorporated).          and IRS exemption, separate from the Lodge group
2. Deed, contract for deed or notice of purchaser’s     exemption through Grand Lodge, that temple
interest that evidences ownership.                      association will be required to file as well. Further,
3. Photograph of the property.                          if your Lodge sponsors its own §501(c)(3) charitable
4. Federal Internal Revenue Service Tax Exempt          organization that owns real property, that charitable
Status letter, such as a copy of 501(c)(3) letter. If   organization will be required to file for any real
you do not have the letter, include a separate sheet    property it owns.
with the reason why.
                                                          Since all Lodges in Montana are operated under
Page 6                                                  the Grand Lodge A.F.&A.M. of Montana charter
                                                        and are covered by the Grand Lodge IRS group non-
                                                        profit exemption, the Executive Committee thought
                                                        it might be easier if Grand Lodge prepared a group
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