8 Colo. Code Regs. § 1304-2-II
Current through Register Vol. 47, No. 20, October 25, 2024
Section 8 CCR 1304-2-II - RELIGIOUS PURPOSESThe following rules apply to all organizations/properties exempted/applying for exemption as owned and used for religious purposes.
A. DEFINITIONS 1. "Declaration" means a written document embodying or displaying a positive, explicit, or formal statement.2. "Gross rental income", for the purposes of 39-3-106.5 (1) and (1.5), 39-2-117 (1)(b)(II), and 39-2-117 (3)(b)(II)(A), C.R.S., means any and all income received by the owner for the use of the property from persons whose activities:(a) do not fall within the religious mission of the owner and are not for religious purposes, strictly charitable purposes, or schools; or(b) are for strictly charitable purposes or schools but the agreement between the owner and the user does not meet the requirements of 39-3-116 (2)(c), C.R.S.3. "Religious mission" means a ministry commissioned by a church or some other religious organization for the purpose of propagating its faith or carrying on humanitarian work.B. GENERAL PROVISIONS 1. The declaration must include the owner's religious mission and purposes and a list of all uses of the property which are in furtherance of the owner's religious mission. When filing an application, that list shall include the name of each user, as defined in Rule I.A.27., including the owner, and a brief description of the use(s) by each user during the previous twelve months or that portion of the twelve-month period for which such property was owned by the owner making application. When filing a declaration with an annual report, that list shall include the name of each user, as defined in Rule I.A.27., including the owner, and a brief description of the use(s) by each user during the previous calendar year, or that portion of the previous calendar year for which such property was owned by the owner filing the annual report.
2. Owners of property exempt as owned and used for religious purposes under 39-3-106, C.R.S., who allow their property to be used by another entity to further the religious mission of the owner or of another religious organization, are not limited to receiving one dollar per year plus an equitable portion of the reasonable expenses from those users. When such property, exempt under 39-3-106, C.R.S., is used by other entities for schools or for strictly charitable purposes, the owner is limited to receiving one dollar per year plus an equitable portion of reasonable expenses.
3. "Complete list of all uses of the property other than by the owner thereof" shall include the name of each user and a brief description of the use(s) by each user during the previous calendar year. This list should not include those uses which are claimed to be part of the owner's religious mission. This list shall be divided into two sections. The first section shall include the names and a brief description of each type of use by those users who operate for strictly charitable purposes, for religious purposes that are not part of the owner's religious mission, or as schools.
The second section shall include the names and a brief descriptions of each type of use by those users who do not operate for religious purposes, strictly charitable purposes, or as schools.
4. In determining whether a user can be included as operating for religious purposes, strictly charitable purposes, or as a school, the religious organization shall consider whether that user meets the criteria for exemptions set out in 39-3-106 to 113.5 and 39-3-127.7, C.R.S. and these rules, and whether any agreement between the owner and the user meets the tests set out in 39-3-116, C.R.S. and Rule II. B. 2.5. Any use for private gain or corporate profit cannot be considered as a qualifying part of an owner's religious mission nor as meeting the test for qualifying use in 39-3-116 (2)(b), C.R.S. All such uses must be included as non-qualifying uses for the purpose of computing incidental use under 39-3-106.5 (1) or (1.5), C.R.S.6.Calculating Adjusted Hours - See Rule I.B.27.7. An owner need only account for income from unrelated trades or businesses that are not owned and used for religious purposes, strictly charitable purposes, or as a school when figuring gross income from unrelated trades or businesses for the purposes of 39-3-106.5 (1)(b)(I) or (1.5)(b)(I), C.R.S.9. An organization exempted under the provisions of 39-3-106 and/or 39-3-106.5 (1) or (1.5), C.R.S., may not file an annual report until all previously due annual reports are filed with the appropriate fee. An annual report which is not filed with the appropriate fee by July 1, of the year following its issue, shall operate as the forfeiture of any right to claim exemption of previously exempt property from general taxation for the year in which failure to file such annual report first occurred and shall preclude the filing of any annual report for subsequent years.
A separate annual report must be filed for each year in which the owner wishes to maintain an exemption.
11. For properties that are claimed to be owned and used for religious purposes, the Administrator will consider the property to be sufficiently used for religious purposes when either: (a) The owner can demonstrate sufficient actual, physical use of the subject property for religious purposes, or;(b) The owner can demonstrate that the property has been physically used at least once during each twelve month period, or any lesser time period if the applicant has not owned the property for the entire twelve month period, and can document sufficient continuing indicators of intent for the remainder of that year or portion thereof.12. When an applicant has not shown sufficient actual, physical use of a property to satisfy Rule II. B. 11(a), the Administrator will also consider "indicators of intent". "Indicators of intent" are the owner's off-site activities which establish its specific intent to further use the subject property for religious purposes. Indicators of intent will be determined by asking questions which include, but are not limited to:
(a) How was the property acquired?(b) How long has this organization owned the property?(c) Has the owner been actively involved in dealing with local government bodies in the pursuit of planning, zoning or other permit issues?(d) Has the owner set up a special fund to finance the project, and is it actively soliciting money for that fund?(e) Has the owner been working with financial institutions and/or working on the sale of bonds?(f) Has the owner set up a committee or other structure to plan and implement the plan of the use of the property, and is the committee actively dealing with that issue?(g) Is the owner actively seeking any necessary clearances from denominational or synodical bodies?(h) Has the owner employed architects or contractors in preparation for actual construction work on the property?(i) Have anticipated starting and completion dates been set for any improvement projects?(j) What is the size of the owning organization and what is the size of any contemplated project?(k) Has the owner had the property listed for sale?(l) Has the owner been using the property, or allowing the property to be used, for monetary gain?(m) Are there any other unusual or urgent circumstances that need to be considered?13. In cases where there is not sufficient actual physical use of a property, but there are sufficient continuing indicators of intent to use the property for religious purposes, an exemption for property owned and used for religious purposes will become effective upon the earlier of either:(a) the date of the first actual physical use for religious purposes, or(b) the date indicators of intent began, so long as the first actual use for religious purposes occurs within one year of that date. Nothing in this rule shall allow an exemption to become effective prior to the year prior to the one in which application is made.
39 CR 23, December 10, 2016, effective 12/30/201646 CR 23, December 10, 2023, effective 1/1/202447 CR 15, August 10, 2024, effective 6/28/2024, exp. 10/26/2024 (Emergency)47 CR 18, September 25, 2024, effective 10/15/2024