The United Methodist Church will be compensated by the United States government, a top US official said Wednesday, in a significant step towards the church’s plan to repay tens of millions of dollars it owes the government.
The Church’s tax-exempt status was revoked in the 1970s and the IRS has been withholding funds from the denomination for more than two decades, prompting the church to pay millions of taxpayers and charities.
Since 2010, the IRS said the church would pay its tax bills on its behalf, but it had been unclear how much it would actually receive.
“The United Methodist denomination will continue to pay the full amount of taxes due to the IRS,” said US Treasury Secretary Timothy Geithner, in announcing the new settlement with the church.
At least $6.4 million in payments to the church have been made since 2010, including $1.2 million in 2011 and $1 million in 2012, according to IRS records reviewed by The Hill.
While the IRS will not be able to audit the church, it can request a list of its tax payments and will be able request that information from the church itself, Geithson said.
This will be the first time in nearly 50 years that the U.S. government has directly paid the United Methodist church for the government’s debts, Geichner said.
The Church of Jesus Christ of Latter-day Saints also agreed to pay $1 billion in taxes to the government, which includes more than $1,300 per day.
In addition, the church agreed to settle a lawsuit brought by a nonprofit group over the church paying for meals for employees.
If the church doesn’t pay the $1 bill by the end of the year, it could face a possible $1-billion fine from the IRS, which has taken on the task of paying off the government for more that $100 billion.
However, the UMS has said it intends to pay off most of the $3.2 billion owed to the US.
The church had not paid all of the tax bills due until 2018.
Other major American charities that have paid the government include the American Cancer Society, The Salvation Army, the Salvation Army Foundation and the Salvation Alliance.