Tax Relief: Detroit firm comes to aid of Grace in Action Church

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By Linda Laderman
Legal News

Thanks to pro bono efforts from the Detroit law firm Butzel Long, members of Grace in Action Church have been granted a retroactive tax exemption, allowing its leader, Pastor John Cummings, to focus on the church’s mission rather than on unresolved tax issues.

Located in Southwest Detroit, the church, part of the Southeast Michigan Synod of the Evangelical Church in America, ran into trouble when it applied for a tax exempt status after it moved into its current location in 2015.
“We tried to move things forward as much as possible,” Cummings said. “We knew churches were considered to be nonprofits so we thought applying for the tax exemption would be pretty straightforward.”

But instead of an uncomplicated path, the application process turned out to be a rocky road paved with foreclosure notices that threatened the church’s ability to remain in its Lawndale Street building.

“Because our location had been commercial before we moved in, we were taxed as a commercial business,” Cummings said. “The taxes were piling up as we tried to fix the problem, but we just weren’t able to make any progress with the city, until we connected with Butzel Long.”

Through a connection with Butzel Long shareholder Dan Rustmann and the efforts of Haley Jonna, an associate in the firm’s Real Estate Practice Group, the bureaucratic logjam began to unclog.

“They were having trouble figuring out how to maneuver within the system and get the tax exemption applied retroactively. We helped them cross the T’s and dot the I’s that were left undone on the application when they first acquired the property,” Jonna said. “We essentially moved the process along. When you are running a church, you are not supposed to know who to talk to.”

For Jonna, a 2016 graduate of Wayne State Law School, the opportunity to help Grace in Action Church was an extension of her belief that, as an attorney, she should do whatever she can to make a difference in the lives of those who are having difficulty getting access to the information they need to remedy an untenable situation.

“It’s a privilege having the degree that I have, so I think of it as just doing my part. Pro bono work keeps me grounded because I am usually working with huge transactions so it’s easy to get lost in the weeds,” Jonna said, adding, “I was thrilled to pass the good news of the granted exemption to Pastor John. There was such a sigh of relief.  There is great joy in giving back to people, like Pastor John, who are helping other people.”

As for Cummings, a pastor who leads a church that fosters inclusivity for the many diverse constituencies that are part of Grace in Action, the red tape attached to the tax exemption left him unsure of what his next steps would be if the church wasn’t able to unravel the legal quagmire surrounding the exemption.

“If Butzel Long hadn’t helped us we would have had to look at having multiple fund-raising efforts over the next couple of years. It was huge relief for me because until they got involved I felt like I was the only one trying to get it fixed,” Cummings said. “Haley just jumped in and took it seriously right away. She was amazing.”

Despite having to face foreclosure on the church’s building, Cummings said he never lost faith that the situation would be resolved favorably.

“I thought, ‘We are going to pursue our mission while we do everything we can to resolve our taxes,’” Cummings said. “God put us here and a lot of good things were happening, so I just had to trust that we would find a way to get through this. I’m grateful this has worked out. Now my mind and energy are freed up.”

With the tax burdens behind him, Cummings said the experience left him with a keen awareness of the good fortune the pro bono intervention provided for his organization.

“Now we can look forward to gathering funding for our projects in arts, culture and reaching out to middle-schoolers through storytelling,” Cummings said. “If we hadn’t had access to legal help, we don’t know what we would have done, but knowing other groups have the same experience without the kind of legal help we had is an ongoing problem.”
 

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