Out of 51 U.S. jurisdictions, New York ranks #23 overall for its friendliness towards faith-based nonprofit organizations. New York has several laws that facilitate the contributions of faith-based nonprofits, including exemptions from nondiscrimination laws regarding employment that protect the autonomy of religious organizations as well as state sales tax exemptions available upon application. New York, however, has some policies that are burdensome to faith-based nonprofits operating in the state, such as a Blaine Amendment, and a burdensome audit requirement to maintain charitable solicitation registration, and a lack of a RFRA.
The New York Constitution has been interpreted by the New York Court of Appeals to provide stronger protections for religious free exercise or worship than the federal First Amendment (as currently interpreted by the US Supreme Court) but does not impose strong protections such as strict scrutiny review when neutral laws burden religious exercise.
New York’s nondiscrimination laws generally restrict religious freedom for religious organizations that offer public programming and facilities but provide accommodations or exemptions for the vast majority of religious organizations.
New York’s nondiscrimination laws related to employment, according to the text of the state statute, provide strong accommodations or exemptions to generally protect the autonomy of most religious organizations. Note that New York regulations may narrow the scope of these strong exemptions.
The New York Constitution contains a Blaine Amendment that could prevent the participation of faith-based schools in generally available public benefit programs on the same terms as similarly situated secular schools. This is not as broad as a general Blaine Amendment, which prohibits all aid to faith-based institutions, but is still detrimental to the work of faith-based institutions. Current U.S. Supreme Court precedent has rendered this language ineffective in many cases, but it could become effective in the future if Court precedent changes.
New York nonprofit corporation law does not have any law deferring to religious beliefs and structures in governance matters and does not have any special provisions specific to the internal governance or operations of religious organizations.
New York law includes requirements for the Attorney General to consent to voluntary dissolution, amendments to the articles of incorporation when the amendment would change or eliminate the corporation’s purpose, and the sale of substantially all assets, or for court approval, and includes a 15-day notice requirement to the Attorney General for sale of substantially all assets done in court and 10-day notice for voluntary dissolution done in court.
New York law affirms the ability of a director to, in the fulfillment of the director’s fiduciary duties, 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.
As a condition of maintaining authorization to fundraise in the state, New York requires the submission of reviewed or audited financials for organizations with annual gross income of more than $250,000.
New York imposes a sales and use tax on religious organizations’ sales but generally provides a broad and comprehensive, entity-based tax exemption for 501(c)(3) religious organizations’ sales upon application.
New York 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.
New York imposes property tax but, upon application, generally provides an exemption to religious organizations for property used for religious and/or charitable purposes.
