Massachusetts ranks #47 overall out of the 51 U.S. jurisdictions for its friendliness towards faith-based nonprofit organizations, making it one of the worst states in which to operate a faith-based nonprofit. Massachusetts has some policies that facilitate the contributions of faith-based nonprofits, including an automatic exemption from state corporate income tax for religious organizations that have 501(c)(3) status. Massachusetts, however, has several policies that are burdensome to faith-based nonprofits operating in the state, such as sales tax with no meaningful exemptions on religious organizations’ sales, an audit requirement to maintain charitable solicitation registration, no RFRA, and laws regarding public accommodations that include no meaningful exemptions for religious organizations.
Religious Freedom:
State Constitutional Protection of Free Exercise:
3
/5
The Massachusetts Constitution has been interpreted by the Massachusetts Supreme Court to provide stronger protections for religious free exercise or worship than the federal First Amendment.
State Religious Freedom Restoration Act:
-5
/5
Massachusetts has not enacted a RFRA and has enacted nondiscrimination laws that conflict with the beliefs of many religious organizations.
Religious Freedom for Nonprofits with Public Programming:
-5
/5
Massachusetts’ nondiscrimination laws generally restrict religious freedom for religious organizations that offer public programming and facilities and provide no meaningful religious accommodations or exemptions.
Religious Freedom for Faith-Based Employers:
-3
/5
Massachusetts’ nondiscrimination laws related to employment have only narrow accommodations or exemptions for only a subset of religious organizations.
Protections for Religious Exercise in State of Emergency:
-3
/5
Massachusetts law has no explicit constitutional or statutory protections for religious exercise during a time of emergency.
Blaine Amendment:
-5
/5
The Massachusetts Constitution contains a Blaine Amendment that broadly restricts faith-based organizations’ freedom to participate in public benefit programs on the same terms as similarly situated secular institutions. Current U.S. Supreme Court precedent has rendered this language ineffective, but it could become effective in the future if Court precedent changes.
Regulatory Freedom:
Nonprofit Religious Corporation Act:
0
/5
Massachusetts’ nonprofit corporation law mentions the option for nonprofit corporations to incorporate for religious purposes. However, the law lacks both: (a) specific provisions to protect the right of nonprofits incorporated for religious purposes to self-government in internal affairs and (b) an option to incorporate expressly as a nonprofit religious corporation.
Standards of Conduct for Directors of Religious Organizations:
3
/5
Massachusetts law permits a director, in the fulfillment of the director’s fiduciary duties, to rely on the opinion of individuals who can reasonably be assumed to have expertise on a certain matter, but does not expressly allow a director to rely on guidance from religious figures within his or her faith tradition.
Charitable Registration Law:
0
/5
Massachusetts generally requires charitable solicitation registration and, as interpreted by state regulation, only exempts entities that are not required to file Form 990, such as organizations classified as churches, religious orders, etc.
Audit Requirements Pursuant to Charitable Registration:
-5
/5
As a condition of maintaining authorization to fundraise in the state, Massachusetts requires the submission of reviewed or audited financials even for organizations with annual contributions of $500,000 or less.
Corporate Income Tax:
5
/5
Massachusetts imposes a corporate income tax but automatically exempts organizations with federal 501(c)(3) exempt status.
Sales and Use Tax, Sales:
-5
/5
Massachusetts imposes a sales and use tax on religious organizations’ sales and provides no meaningful exemption.
Sales and Use Tax, Purchases:
3
/5
Massachusetts imposes a sales and use tax on religious organizations’ purchases but generally provides a broad and comprehensive, entity-based tax exemption for 501(c)(3) religious organizations’ purchases upon application.
Property Tax:
3
/5
Massachusetts imposes property tax but, upon application, generally provides an exemption to religious organizations for property used for religious and/or charitable purposes.
