Church Parking Spaces Leased to Students are Taxable

St. George’s Episcopal Church v. Town of Durham
New Hampshire Supreme Court No. 2015-0671
Friday, December 9, 2016

Until 2013, St. George’s received a religious tax exemption under RSA 72:23, III for its entire parking lot. However, in 2013, the Town learned that the church was leasing some its parking spaces to UNH students. Thereafter, the Town issued a tax bill for the portion of the lot that was leased. The church filed an action, and the superior court determined that the parking spots being used by students were not exempt because they were not “used and occupied directly” by the church for religious purposes.

RSA 72:23, III exempts from taxation “[h]ouses of public worship . . . , buildings and the lands appertaining to them owned, used and occupied directly for religious training or for other religious purposes by any regularly recognized and constituted denomination.” The trial court judge found that leased spaces are “used and occupied directly” by the UNH students for “all but about six hours each week, plus special event days and during snow plowing and repair operation.” Therefore, the parking spots were being used primarily for private and secular purposes, and the church’s use of these spaces for approximately six hours each week was too insignificant to warrant the tax exemption.  

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