Look a little way down from the IRS 501(c)(3) language in the IRS Code. There's the 508(c)(1)(A). --- 501 is for organizations, including organizations that act as a church. These are tax exempt if they follow the rules of the IRS. --- 508 is for churches, no matter how they are set up. These are tax excluded. This means that the IRS is hands off regarding them. --- The reasons why churches enjoy the 501 are: 1) they are ignorant of the 508; 2) the 508 is set up to offer the church tax exclusion, but not the people who work in the church, except that the church is formed under the right kind of corporation sole. - https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section508&num=0&edition=prelim