Follow-up on Non-Profit Status

 [[Sister, Thank you for your answer to my last question. It was very helpful. If you don't mind though, let me ask for clarification on one point. I asked about diocesan hermits and you referred to those professed under c 603. Are there any other Catholic hermits but who do not qualify for non-profit status? Could "Joyful Hermit" the author of the blog I cited be a different kind of Catholic hermit who therefore doesn't qualify for 501(c)3? Does the Church verify a person's standing and eligibility in such cases?]]

Thanks for the follow-up questions. The simple answer to both of these is no. Catholic hermits may be solitary (c 603, what is called "diocesan") or belong to religious congregations (institutes). Either of these kinds of hermits may establish themselves or their ministries under 501(c)3 --- (in the case of a hermit who belongs to a congregation, the congregation might establish themselves in this way). There are no other hermits who qualify to be called "Catholic Hermits" because there are no others who are publicly professed or consecrated; at the same time then --- there are no other hermits who may qualify (qua hermits) for 501(c)3 status.

Yes, such standing, whether of a solitary hermit or a congregation of hermits, requires (and such hermits are able to supply) the Church's verification of consecrated status (canonical standing) --- hence, for instance, the affidavit diocesan hermits are given at perpetual profession/consecration identifying them as hermits of the Diocese of ____. This does not mean merely that they are a hermit with private vows living in the Diocese of ___. It means they represent eremitical life in the name of the Church, are thus publicly professed, consecrated, and commissioned in this specific local Church under the canonical supervision or jurisdiction of the hermit's Bishop; they may, therefore, become 501(c)3 or establish themselves publicly in other ways (including wearing a habit, for instance, or styling themselves as Sister or Brother). Folks in private vows, including priests and lay people who are living as hermits may not set themselves up as 501(c)3 hermits/hermitages because they do not live their eremitical callings in the name of the Church (that is, they are not called, vowed or dedicated and commissioned as well as supervised by the Church per se).

As you may remember, there are three avenues to eremitical life in the church today. The first two are canonical and involve consecration (initiation into the consecrated state) by God through the mediation of the Church. These are 1) congregations of hermits in canonical communities and 2) solitary hermits professed and consecrated under canon 603. Both are public and ecclesial vocations which represent some expression of the eremitical life lived in the Church's name --- the Catholic eremitical life. The third avenue is non-canonical or privately dedicated eremitical life (either lay or clerical).

These "third avenue" vocations may be lived alone as solitary hermits (most common) or in communities of hermits (less common) and are important vocations; they may well be sterling expressions of eremitical life that speak especially well to other lay persons who may underestimate their own call to prayer, holiness, silence and solitude, or their responsibility to live countercultural lives for example (this situation is often a tragic holdover from times when the lay vocation was not adequately esteemed and was played off against supposedly "higher" vocations like consecrated life); thus, these vocations possess great dignity and the Church esteems them highly. Even so, as noted many times here, they do not represent instances of the consecrated state of life nor do they represent "ecclesial vocations" per se which can thus use the title "Catholic" to refer directly to their eremitical life, their congregational standing, or their commissioning by the Church  -- e.g., Catholic congregations, Catholic Hermits, Catholic theologians, and so forth. Such hermits are Catholic and hermits, but they are not Catholic Hermits. Think here of the analogy of a police officer living in San Francisco and working for the SMPD and the City of San Mateo; such an officer is not a San Francisco Police Officer.

Catholic Hermits and Non-Profit Status

[[Sister, I was told that diocesan hermits (solitary Catholic hermits) could file for 501c(3) tax exemption. This hermit seems to disagree: [[But a hermit does not have others in the temporal realm to help clean and unpack, organize, to cook and in our time period, handle procurement of supplies.  There is no extern nun or monk; and a consecrated Catholic hermit has not tax exempt status, so the IRS duties are the hermit's own, and for me, once I gather and provide all the numbers from receipts and appropriate 1099 income forms, a long-time accountant will crunch the numbers, fill in the proper forms, and file my tax returns.]] (Catholic Hermit, Letter from Spiritual Father, italics added) Is she correct or was I misinformed?]]

In this case Ms McClure (aka, Joyful Hermit), a privately vowed lay hermit who writes the blog you cited, and who, therefore, might well not be expected to know about tax exempt status for canonical hermits, is incorrect and you were properly informed. Solitary Consecrated Hermits (that is, Diocesan Hermits -- canonically professed and consecrated under c 603) can and do set their hermitages up as 501(c)3's if that works for them. The Church permits (and the US tax code allows) and in some instances, may even encourage this. In such cases the hermit only pays taxes on income which has nothing to do with the religious nature and mission of the hermitage; (the classic example is the charity that, besides its primary mission or reason for existing also makes some money repairing bicycles. They do pay taxes on that money). Canonical (Catholic) hermits are also free from property taxes and sales tax when they are established as 501(c)3's. Non-profits do pay various taxes for employees (Social security and Medicare). 

I should note that not every canonical (publicly professed) solitary hermit does this however; for some of us becoming recognized as non-profits is of no real benefit because 1) our incomes are so small we do not usually pay much if any income tax, and 2) we do not own our hermitages, and thus, are not responsible for property taxes anyway. Moreover, everything coming into the hermitage benefits us directly unless we are giving retreats, for instance, and have legitimate expenses connected with that which benefits others. (501(c)3's are not allowed to benefit directly from the money coming to the institution.) Apparently, however, for those diocesan hermits who depend on benefactors 501(c)3 is helpful because it allows those donating to the hermit's upkeep to get a tax break (a deduction) on their donations. How it is that the income coming in in such circumstances is not considered to benefit the hermit directly is hard to fathom.

This is not an area I am particularly expert on myself since I have not decided to use 501(c)3 to establish myself or my hermitage as a non-profit. I keep thinking I will ask an attorney about the possibilities in case I am missing some benefit that might assist me in living my life and pursuing my mission, but I haven't done so. Also, questions on this matter have been infrequent so beyond affirming the possibility of 501(c)3, I have not needed to write much about it. Your own question is pretty straightforward, however. To summarize, consecrated (that is, canonical) Catholic hermits or hermitages are allowed by the Church and the US Tax code to establish themselves/their hermitages as non-profits under 501(c)3, but this is only feasible in certain circumstances. Each hermit who is publicly professed and consecrated under c 603 is encouraged to consider the benefits of doing this for themselves with the aid and advice of a civil attorney.