Out of 51 U.S. jurisdictions, North Carolina ranks #12 overall for its friendliness towards faith-based nonprofit organizations. North Carolina has several laws that facilitate the contributions of faith-based nonprofits: North Carolina has no audit requirements for religious organizations to solicit donations in the state, no nondiscrimination laws related to public accommodations, and no Blaine Amendment. North Carolina, however, has some policies that are burdensome to faith-based nonprofits operating in the state, such as a lack of protections for religious exercise during a state of emergency, and a lack of a RFRA.
The North Carolina Constitution follows in lockstep with the federal constitution’s protections, meeting but not exceeding the required minimum protections of the First Amendment (as currently interpreted by the US Supreme Court).
North Carolina’s nondiscrimination laws enforce the federal nondiscrimination laws related to employment, which include broad exemptions for most religious organizations.
The North Carolina Constitution does not contain a Blaine Amendment but also does not expressly protect faith-based organizations’ freedom to participate in public benefit programs on the same terms as similarly situated secular institutions.
North Carolina nonprofit corporation law includes certain provisions to protect religious nonprofits’ right to self-government in internal affairs in some situations but does not include comprehensive laws specific to nonprofit religious corporations.
North Carolina 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.
North Carolina charitable solicitation law contains exemptions for some religious organizations, such as churches and schools accredited by certain agencies listed in the state statute.
North Carolina does not require the submission of reviewed or audited financials as a condition of maintaining authorization to fundraise in the state.
North Carolina 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. Note that the exemption comes in the form of a semiannual refund of any sales tax paid and that the religious organization must file an application to receive the refund.
North Carolina imposes property tax but, upon application, generally provides an exemption to religious organizations for property used for religious and/or charitable purposes.
