Registering a synagogue as an Amuta
Why should you register a synagogue as a non-profit organization?
Registering a synagogue as an Amuta helps a socially and publicly active synagogue receive exemptions or discounts on its VAT, income, and municipal taxes (Arnona). Any synagogue with a significant financial turnover that is funded by donations from worshipers and public institutions will save a lot of money by registering as a non-profit organization. The law firm of Cohen, Decker, Pex, Brosh (branches located in Jerusalem and Petach Tiqva) specializes in registering and helping manage nonprofit organizations. Other important articles on our website deal with municipal tax exemptions for synagogues or Amutot. This article by Israeli attorney Michael Decker will explain how to register a synagogue as a nonprofit association, as well as the advantages of such registration.
What are the advantages and disadvantages of registering a synagogue as an Amuta?
The benefits, as mentioned above, include an exemption from VAT, income tax, and / or municipal taxes (a double discount, both for the prayer house as a real estate property, and for the synagogue association). This is a discount that can help the synagogue save a great deal of money, which may be used to fund its community activities. If the synagogue engages in community outreach: charitable activities, education, religious services – it may be a good idea to register as an Israeli NGO. In short, when the synagogue is not active only on Saturdays and holidays, but is involved in the life of the surrounding community and has a significant cash turnover and donations – then the responsibility involved in running an Amuta, such as opening a bank account, recording expenses, bookkeeping, recording donations, and ensuring that the Amuta’s activity is transparent to the donors, the public, and the government, should be neither new nor unduly onerous to the synagogue.
The disadvantages of registering a synagogue as an Amuta are the need to report to the authorities regarding the activities of the Amuta, the donations it receives and its expenses. The Amuta must submit reports to the Registrar of Amutot and open a file with the Income Tax Authority. In addition, before a synagogue is registered as a non-profit organization, a meeting must be held in which a majority of the permanent worshipers of the synagogue will approve the decision. The decision must be documented in a properly written protocol. After the decision is approved, it is mandatory to elect an Amuta committee, chose an original name for the association and approve a list of bylaw. Sample bylaws for the Amutah can be found on the Ministry of Justice website.
Registration of a Synagogue as an Amuta:
The registration of a synagogue as a non-profit organization is similar, but not identical, to the establishment of a regular non-profit organization. It should be noted that if the building of the synagogue itself is registered as a non-profit organization, than the different organizations using the synagogue may be required to contact the association if they wish to use the same building. In this case during the registration process we should note that the synagogue itself is being registered as a non-profit organization, rather than an association being established within the synagogue. As a result, it is necessary to specify whether the synagogue is unified in terms of management, congregation, and activity. If a number of separate organizations use the synagogue building for their own needs, they may have to contact the Amuta if they wish to use its resources and donations. If two separate “synagogues” with different congregations and administration use the same building, registration is more complicated.
Due to the connection between the building of the synagogue and the association, for the purpose of registering a synagogue as an Amuta it is necessary to specify assets, rights to properties, and ownership of the rights to the synagogue’s land. In addition, there is a difference between registration as an amuta in an existing synagogue, or a synagogue that is newly constructed / still under construction.
Details required for registering a synagogue as an Amuta:
The founders are asked to add the following details to the application form for registering a synagogue as an association:
The proposed name – names of synagogues tend to be similar, so the Ministry of Justice requires the Amuta name to follow the formate of “Amuta – synagogue – municipality.”
The address of the association – both the exact address of the synagogue and the postal address.
Affidavits – An affidavit signed by all the founders of the association must be attached to the registration form, stating the status of the synagogue, details of the synagogue’s assets, details of ownership and registration of the synagogue building.
Approval of Use of the Property – If the owner of the property is not a member of the Amuta, a use authorization document must be obtained.
The minutes of the assembly in which the decision was made – as noted above most of the congregation must approve the decision to register the synagogue as an association.
What happens after registering a synagogue as an Amuta?
The logical next steps after registration of the synagogue as a non-profit organization are the opening of a bank account for the Amuta, officially starting the Amuta’s activities and the subsequent receipt of a good management certificate (for a newly established organization). It is important to remember that proper management approval is a necessary condition for receiving tax exemptions for donations to the synagogue, which is the main purpose of registering the synagogue as an Amuta. In order to obtain the approval, it must be shown that the Amuta is properly managed according to Israeli law, and uses transparent and appropriate bookkeeping. .
Of course, in order to register a synagogue as a non-profit organization and in order to obtain a proper management approval, it is recommended to contact an Israeli attorney specializing in non-profit organizations. The law firm of Cohen, Decker, Pex, Brosh will be happy to assist you with information and legal aid regarding nonprofit organizations.