City, county, state and federal taxing authorities still use the mail to notify of tax obligations. While these notices are not always correct, and even some correct ones may be challenged, simply ignoring them does not make them go away. Reciting mantra’s like, “they can’t tax a church,” or “I’ll just give them a call to fix it,” are often the first words spoken in a church legal or financial disaster.
In Wings as Eagles Deliverance Ministry v City of Detroit, Opinion and Order (USDC, ED Michigan 2022), the city imposed property taxes on property owned by the ministry. The Plaintiff received from the City notices of taxes owed in several consecutive years. Finally, the City sought and received a Judgment of Foreclosure and transferred ownership of the property to a subsequent owner. (The federal trial court opinion does not explain the tax collection system in detail. But, somehow, the property ownership was transferred without an auction for zero dollars, implying not even the taxes were collected, and leaving no Excess Proceeds for the prior owner to collect. But, a more detailed study of the property tax collection system of Michigan is beyond the scope of this report.) The federal court entered judgment for the City because the state level Judgment was final and precluded review by the federal trial court. (Apparently, the Plaintiff took no action against the state level Judgment, such as an appeal to the Michigan court system. However, that is not completely clear from the federal trial court’s opinion.) Constitutional claims based on the Establishment Clause were unavailable because they were not asserted against the state level Judgment.
The Plaintiff in the reported case should have taken definitive action as to the first notice of tax delinquency and every notice thereafter. The state level Judgment should have been appealed. The best method of dealing with such matters, if a diplomatic visit to the taxing authority does not result in a written withdrawal of the notice in a timely way, is to pay the delinquent tax under protest and then sue to recover the money paid.