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House says no to a grab on tithing in bankruptcy

SHARE House says no to a grab on tithing in bankruptcy

The House gave final approval Wednesday to a bill that would prevent forcing churches to return tithing paid by members who later file for bankruptcy.

The House passed the bill on a voice vote, which last month cleared the Senate on a 99-1 vote. It now goes to President Clinton for signature.The bill has been a high priority for Sen. Orrin Hatch, R-Utah - who co-sponsored it in the Senate with Sen. Charles Grassley, R-Iowa - and other members of Congress who are members of The Church of Jesus Christ of Latter-day Saints.

A main House sponsor of the bill was Rep. Ron Packard, R-Calif., who is also LDS. Also, Rep. Chris Cannon, R-Utah, pushed the bill during floor debate on Wednesday.

The bill would bar courts from forcing churches to refund tithing as long as they have qualified as a charity under Internal Revenue Service rules. It allows churches to keep up to 15 percent of the debtor's gross income in the year the payment was made.

Cannon said, "It avoids the effect of our current course that puts federal bankruptcy court judges in the position of knocking on the doors of our churches, wearing the hat of a repo man, and demanding the return of tithes, offerings and other contributions."

Hatch said in earlier Senate debate that recent court actions ordering some churches to return some offerings threaten "the ability of religious institutions not only to function, but to survive."

Hatch said that's because "churches and charitable institutions are placed in the precarious and uncertain position of not knowing if and when a court will order them to repay money that may already have been spent."