Daycare.com Forum
Daycare and Taxes>For Profit Center Located In Church. Property Tax?
HCTS 09:01 AM 12-11-2013
Hello All,
I just now registered for this site! I am the owner of Here Comes the Sun Childcare Center located in a Church in Mn. We are for profit. We opened in 2008 and are licensed for 50 children. Three years ago I was givin a bill by the church secretary for $4000 which was for property tax. On our original lease we are required to pay 10% of our monthly income for rent which is anywhere from $1000-$1800 per month. Well 3 years ago we were givin this bill which by the way was addressed to the church that we were responsible to pay the bill. At that time I asked if I could attend the next Church board meeting to discuss this bill. At meeting I asked if we could split the bill since we are both profiting from my business. Well the answer was no because if my daycare wasn't there there would be no bill. Since then the property tax is at almost $4500/year! In 2008 right before we moved in the Church was bankrupt and about to close for good. Since we moved in, we've provided new church members and $$ to help them. I've seen pastors's and board members come and go yet I'm still there. They don't respect us or our belongings, yet their stuff is off limits. I could go on and on. My question is, are we responsible for paying the property tax even though the bill is addressed to them? Any help in this matter would be a blessing! Thank You. I'm also so glad to find this site!
Travis
I just now registered for this site! I am the owner of Here Comes the Sun Childcare Center located in a Church in Mn. We are for profit. We opened in 2008 and are licensed for 50 children. Three years ago I was givin a bill by the church secretary for $4000 which was for property tax. On our original lease we are required to pay 10% of our monthly income for rent which is anywhere from $1000-$1800 per month. Well 3 years ago we were givin this bill which by the way was addressed to the church that we were responsible to pay the bill. At that time I asked if I could attend the next Church board meeting to discuss this bill. At meeting I asked if we could split the bill since we are both profiting from my business. Well the answer was no because if my daycare wasn't there there would be no bill. Since then the property tax is at almost $4500/year! In 2008 right before we moved in the Church was bankrupt and about to close for good. Since we moved in, we've provided new church members and $$ to help them. I've seen pastors's and board members come and go yet I'm still there. They don't respect us or our belongings, yet their stuff is off limits. I could go on and on. My question is, are we responsible for paying the property tax even though the bill is addressed to them? Any help in this matter would be a blessing! Thank You. I'm also so glad to find this site!
Travis
Blackcat31 09:12 AM 12-11-2013
I am not understanding the line of thinking on their part stating that if you weren't there, there would be no bill.
I thought property tax was exactly that...tax on the property.
Even if you weren't there, there would still be property taxes due.
Our seasonal property that we use only in the summer months still property taxes due. Even if we don't use the building or visit for years, we still have to pay property taxes.
What does your rental contract with the church say about this? Was it something you discussed before renting or it is something new that they are charging for?
Welcome to the forum too by the way!
I thought property tax was exactly that...tax on the property.
Even if you weren't there, there would still be property taxes due.
Our seasonal property that we use only in the summer months still property taxes due. Even if we don't use the building or visit for years, we still have to pay property taxes.
What does your rental contract with the church say about this? Was it something you discussed before renting or it is something new that they are charging for?
Welcome to the forum too by the way!
snbauser 09:47 AM 12-11-2013
My guess is that because churches are typically listed as non-profits, there is no property tax. So since you are a for profit entity of the church, then that is why they are saying the property tax is your responsibility. If you have a rental contract with them, then you need to look at that and see what it says you are responsible for.
Edited to add - My guess is this will get ugly if it isn't in your rental contract and you fight it so I would be prepared for them to try and either not renew the contract or to try and push you out.
Edited to add - My guess is this will get ugly if it isn't in your rental contract and you fight it so I would be prepared for them to try and either not renew the contract or to try and push you out.
Blackcat31 09:54 AM 12-11-2013
Originally Posted by snbauser:
My guess is that because churches are typically listed as non-profits, there is no property tax. So since you are a for profit entity of the church, then that is why they are saying the property tax is your responsibility. If you have a rental contract with them, then you need to look at that and see what it says you are responsible for.
Edited to add - My guess is this will get ugly if it isn't in your rental contract and you fight it so I would be prepared for them to try and either not renew the contract or to try and push you out.
Oh wow....that makes complete sense! I didn't know that but it makes sense. My guess is that because churches are typically listed as non-profits, there is no property tax. So since you are a for profit entity of the church, then that is why they are saying the property tax is your responsibility. If you have a rental contract with them, then you need to look at that and see what it says you are responsible for.
Edited to add - My guess is this will get ugly if it isn't in your rental contract and you fight it so I would be prepared for them to try and either not renew the contract or to try and push you out.
TomCopeland 11:31 AM 12-11-2013
Originally Posted by HCTS:
Hello All,
I just now registered for this site! I am the owner of Here Comes the Sun Childcare Center located in a Church in Mn. We are for profit. We opened in 2008 and are licensed for 50 children. Three years ago I was givin a bill by the church secretary for $4000 which was for property tax. On our original lease we are required to pay 10% of our monthly income for rent which is anywhere from $1000-$1800 per month. Well 3 years ago we were givin this bill which by the way was addressed to the church that we were responsible to pay the bill. At that time I asked if I could attend the next Church board meeting to discuss this bill. At meeting I asked if we could split the bill since we are both profiting from my business. Well the answer was no because if my daycare wasn't there there would be no bill. Since then the property tax is at almost $4500/year! In 2008 right before we moved in the Church was bankrupt and about to close for good. Since we moved in, we've provided new church members and $$ to help them. I've seen pastors's and board members come and go yet I'm still there. They don't respect us or our belongings, yet their stuff is off limits. I could go on and on. My question is, are we responsible for paying the property tax even though the bill is addressed to them? Any help in this matter would be a blessing! Thank You. I'm also so glad to find this site!
Travis
I would first talk to the county about this property tax bill. The church can't be charged for property tax, but your center can. However, you want to be sure that this tax was properly applied to your center. Another way to go is to have your center operated as part of the mission of the church, to avoid the property tax. You would have to dissolve your for profit center and be operated by the church (with you as the director). This may not be at all what you want, but it may be the only way to avoid these taxes.Hello All,
I just now registered for this site! I am the owner of Here Comes the Sun Childcare Center located in a Church in Mn. We are for profit. We opened in 2008 and are licensed for 50 children. Three years ago I was givin a bill by the church secretary for $4000 which was for property tax. On our original lease we are required to pay 10% of our monthly income for rent which is anywhere from $1000-$1800 per month. Well 3 years ago we were givin this bill which by the way was addressed to the church that we were responsible to pay the bill. At that time I asked if I could attend the next Church board meeting to discuss this bill. At meeting I asked if we could split the bill since we are both profiting from my business. Well the answer was no because if my daycare wasn't there there would be no bill. Since then the property tax is at almost $4500/year! In 2008 right before we moved in the Church was bankrupt and about to close for good. Since we moved in, we've provided new church members and $$ to help them. I've seen pastors's and board members come and go yet I'm still there. They don't respect us or our belongings, yet their stuff is off limits. I could go on and on. My question is, are we responsible for paying the property tax even though the bill is addressed to them? Any help in this matter would be a blessing! Thank You. I'm also so glad to find this site!
Travis