California Senate Votes to Strip Boy Scouts of Tax-Exempt Status

By Jason Bramwell
By a vote of twenty-seven to nine, the California Senate approved a bill on May 29 that would revoke the tax-exempt status from nonprofit youth organizations, such as the Boy Scouts of America, that discriminate on the basis of sexual orientation, gender identity, or religious affiliation.
The legislation, which required a two-thirds vote instead of a simple majority because it was a tax measure, now goes before the California State Assembly for consideration.
"The protections in this bill live beyond the transitory actions any group may take  now or in the future. The LGBT [lesbian, gay, bisexual, transgender] community must be protected in perpetuity," state Senator Ricardo Lara said in a written statement after the vote. "I am proud that my colleagues joined me today on the right side of history by voting for the Youth Equality Act." 
After reviewing its membership policy for the past several months and soliciting public feedback, the Boy Scouts of America on May 23 lifted a 103-year-old ban that prevented openly gay youths from joining Boy Scouts. The new rule takes effect January 1, 2014.
Lara, who called the Boy Scouts of America "an undeniably important part of young lives and a part of our American fabric," said the organization fell short of implementing a truly inclusive policy by preventing gay adults from becoming Boy Scout leaders.
"While it is a step in the right direction, continuing the ban on LGBT adults is premised on absurd assumptions and stereotypes that perpetuate hate and homophobia," Lara, who is openly gay, told his colleagues. "What? What does this mean? Up to seventeen you're fine to be in the Boy Scouts, but at the stroke of midnight on your eighteenth birthday, you turn into a pedophile or a predator? What kind of warped message does this send? Equality does not have an expiration date."
If a youth organization is deemed to be discriminatory, the bill, if approved, would require the group to pay corporate taxes on donations, membership dues, camp fees, and other sources of income, as well as to obtain sellers permits and pay sales taxes on food, beverages, and homemade items sold at fundraisers.
"The 4-H Club and the Girl Scouts don't discriminate. They don't exclude LGBT members or leaders just for the simple fact of being who they are. Neither do the Boys and Girls Club or the YMCA. Besides being the right thing to do, under current law, these groups' inclusiveness and commitment to equality make them eligible for tax exemptions," Lara said. "At the other end of the spectrum, we have the Boy Scouts of America, an organization with a central flaw so profound that until it is fully fixed, it means that they are out of line with the values of California and should be ineligible for a tax benefit paid for by all Californians."
In a May 27 statement to AccountingWEB regarding the Youth Equality Act, the Boy Scouts of America said, "Through twenty-three local councils, the Boy Scouts of America is focused on serving 180,000 youth in California and on instilling the values of the Scout Oath and Law, which help develop character, citizenship, and fitness."
According to the Boy Scouts of America, a change to the current membership policy for adult leaders was not under consideration; thus, the policy for adults remains in place.
Lara said the Boy Scouts of America has been given ample time to change its policy for adults.
"They've chosen a path that still leads to discrimination," he added. "Discrimination is wrong. Discrimination should not be subsidized. Discrimination has a cost. So to have [the Boy Scouts of America] come this late in the day and fall short, we have to say no more. Not on our watch. Not on California's dime."
Related article:

You may like these other stories...

Savvy tax planning is about more than knowing what to write off. Just as essential is knowing when to take deductions. Choosing to stuff deductions into one tax year as opposed to another bears directly on how much winds up...
Tesco says it overstated profit forecastStanley Reed of the New York Times reported that Tesco, the large British grocery retailer, disclosed on Monday that it had overstated its expected half-year profit by about $400...
The IRS has announced the special per diem rates for 2014-15 that taxpayers can use for substantiating the amount of ordinary and necessary business expenses incurred while traveling away from home. The new per diem rates...

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 21
Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience's communication style.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.