While the process to attain tax-exempt status began several years ago, the actual change was initiated early last month. Although it is desirable that the entire organization be tax-exempt, the complexity of the current tax code makes that possibility unrealistic. However, the two-company solution, which gives BJU, Inc. tax-exemption status, is of great benefit.
Uniquely, Bob Jones Academy is part of both companies. The child development center and elementary school are now part of BJU, Inc., the tax-exempt company. The middle school, high school, and administrative office are part of BJU Education Group, Inc., which we frequently refer to as BJUEG. While this arrangement may seem a bit unusual, it brings overall strength to the entire new structure. Dr. Pettit explained, “By leaving the middle and high schools in the taxable company, both corporations—BJU Education Group and BJU, Inc.—will continue to be schools. This provides the benefit of potential strategic opportunities to cooperate in the future. Having an educational content ministry [BJU Press] and an education delivery ministry in the same organization allows for reciprocal tuition benefits for employees of both corporations and maintains property tax exemptions for both corporations.”
BJA’s current administrative team and structure will continue unchanged through a “master service agreement” between the two companies. This agreement enables us to maintain a unified interaction with the public and our families—families who have children in both the elementary and the secondary will continue to receive one bill; the website, NetClassroom, and weekly emails will remain the same; and so on.
Donations made to BJA elementary school are now tax deductible because the school is part of BJU, Inc. While this is not the case for donations made to the middle school and high school, we hope that you will continue to make donations as you have in the past.
There are many behind-the-scenes details with this exciting change, but most of these will not affect you as parents, your students, or the type and quality of education BJA provides. However, as you do have questions, please ask. We will be glad to answer them for you.