Bob Jones University regains nonprofit status 17 years after it dropped discriminatory policy

BJU entrance (Picture: File)

In a move that is been significantly more than 2 yrs when you look at the generating, Bob Jones University announced Wednesday it can regain its federal tax-exempt status on March 1, significantly more than three years following the IRS stripped its nonprofit status following a landmark U.S. Supreme Court ruling.

The matter within the court instance had been the refusal that is university’s enable interracial relationship or wedding among students, staff or faculty regarding the college, a rule it offers since abandoned.

The conservative Christian college dropped its interracial dating ban in a nationwide televised interview with previous president Bob Jones III on CNN’s Larry King are now living in 2000. In 2008, last President Stephen Jones, great-grandson of evangelist and college creator Bob Jones, apologized for BJU’s past racial discrimination.

Nevertheless the college hadn’t desired to reinstate its tax-exempt status until 2014 after Steve Pettit took over whilst the school’s president that is fifth its 90-year history.

“Organizing being a tax-exempt entity is one thing BJU has had a need to do for a long time,” Pettit stated.

In their very first ending up in the university’s Cabinet, Pettit said he thought it absolutely was suitable for BJU to find its tax-exempt status due to the fact college doesn’t think the jobs it once held about battle.

Pettit called the university’s racist policies an issue that is social had not been biblical.

“The Bible is quite clear,” Pettit stated as he announced the alteration to your college Wednesday evening. “We are constructed of one bloodstream.”

Bob Jones University destroyed its income tax exemption following a 13-year struggle with the IRS over perhaps the university’s policies against interracial dating precluded it as a non-taxable spiritual academic institution. The college didn’t acknowledge any students that are black 1971, 17 years after Brown vs. Board of Education. It then wouldn’t acknowledge any pupils who have been in a marriage that is mixed-race created rules to prohibit pupils from interracial relationship.

The actual situation rose towards www.hookupdate.net/adam4adam-review the Supreme Court, which ruled in 1983 that the IRS could revoke the university’s tax-exempt status since the government’s desire for eradicating racial discrimination from training overrode the university’s First Amendment liberties to spiritual speech that is free.

The scenario happens to be cited times that are many the years. Of late, it arose within an trade ahead of the Supreme Court within the Obergefell vs. Hodges choice, which legalized marriage that is gay. From then on choice, the IRS commissioner stated the agency will never target the tax-exempt status of spiritual organizations that oppose homosexual marriage.

It’s taken two-and-a-half years for BJU to complete the reorganization since it utilized an elaborate want to divide its company into two entities aided by the university dropping beneath the umbrella of its primary school’s current non-profit status to obtain a unique, in accordance with college statements and company documents filed with all the sc Secretary of State together with IRS.

That current nonprofit had been called Bob Jones Elementary class, Inc. until final might, with regards to ended up being renamed BJU, Inc.

The restructuring arrived after “consultation with legal counsel and accountants with several several years of expertise in assisting tax exempt organizations—as well as input from people in the BJU community and our congressional delegation,” Pettit stated.

The alteration didn’t need IRS approval because its elementary college had been a nonprofit, though the college had correspondence that is formal conversations because of the IRS, said Randy web Page, BJU spokesman.

The college is now detailed as being a 501(c)(3) nonprofit regarding the IRS internet site, stated Michael Dobzinski, IRS spokesman.

What it indicates

Up to now, if people in the city or alumni desired to contribute to the college, their gift ideas had been just income tax deductible when they provided to particular nonprofit hands associated with college, such as for instance its scholarship investment, art museum or athletic foundation.

Donors couldn’t provide tax-deductible presents to the college it self to support money promotions and for college initiatives.

Almost all of the large gift ideas into the college recently, such as a $500,000 present through the Sargant Foundation in December and a $1 million anonymous present announced final November, went toward its BJU Scholarship Fund, a nonprofit entity associated with the college.

Now donors’ gift ideas will likely be tax-deductible, web web Page stated.

“It helps whenever you’re attempting to raise cash for a business to own a status that is tax-exempt” Page stated. “That obviously helps your development people, your development folks and the ones in the neighborhood – organizations, people, alumni – to really make it more straightforward to subscribe to a nonprofit.”

The alteration would affect students’ n’t financial aid and wouldn’t influence workers, he stated.

The change amounts the playing field involving the college along with other cousin organizations whenever trying to get funds, he stated.

It moves BJU from the college that is for-profit a nonprofit category aided by the U.S. Department of Education, “which is generally identified more positively because of the public,” web web web Page stated.

That modification could show crucial once the U.S. Department of Education has targeted for-profit universities with additional oversight in the last few years and fined a few for-profit networks of universities underneath the national government, which triggered universities like Corinthian university and ITT Technical Institute closing down.

And even though the college operates debt-free and does not want to accept financial obligation, it might possibly save yourself through reduced interest levels if it thought we would undertake financial obligation, web web Page stated.

just How BJU will likely be organized

On March 1, Bob Jones University, Inc. will likely be renamed Bob Jones Education Group, Inc. and can remain the university’s entity that is taxable will donate approximately half its assets towards the non-taxable BJU, Inc.

The university’s assets will efficiently be split involving the two companies.

BJU, Inc. includes the university and a lot of of its facilities, the art museum, primary college and son or daughter development center. BJU Press article writers will also come underneath the umbrella of BJU, Inc.

The for-profit supply for the college – Bob Jones Education Group, Inc. – should include the BJU Press, University Cleaners and also the Bob Jones Academy center and high schools.

The college will be governed by still its 25-member Board of Trustees. The board will appoint a brand new eight-member board to govern Bob Jones Education Group.

The change procedure started in belated 2014 having a scholarly research of how exactly to attain income tax exemption. Final May 5, the Board of Trustees authorized the last arrange for pursuing taxation exemption together with management happens to be trying to implement it ever since then.

In addition, the college happens to be looking for local certification through the Southern Association of Colleges and Schools Commission on Colleges. The college, that will be detailed as an applicant for certification, notified the payment of the changes that are potential which wouldn’t influence its candidacy, web web Page said.

The university provided SACSCOC having its proposition arrange for income tax exemption and there’s no improvement in governance, stated Pamela Cravey, SACSCOC spokeswoman.

“The action had been an IRS matter and failed to represent a substantive modification,” Cravey stated,

SACSCOC has considered the university as a not-for-profit, she stated.