One of the most persistent rumors surrounding Old Order Amish communities is that they enjoy complete tax-exempt status. Misinformed claims often circulate suggesting that Amish business owners do not pay income taxes, property taxes, or commercial sales taxes. The reality is quite the opposite: Amish citizens pay nearly all the same taxes as any other American taxpayer.
Which Taxes Do Amish People Pay?
Amish individuals and business entities comply fully with state and federal tax codes. Their tax contributions include:
- State & Federal Income Taxes: Amish workers and business owners file annual income tax returns and pay taxes on their net earnings.
- Property Taxes: Paid in full on land, homes, and commercial buildings. A significant portion funds local public schools, even though Amish children attend private parochial one-room schools.
- Sales Tax: Paid on all personal retail purchases, raw building materials, tools, and business supplies.
- Corporate Taxes: Amish-owned LLCs and incorporated businesses pay standard state corporate taxes and licensing fees.
Where Does the Tax Myth Come From?
The widespread tax myth stems entirely from a single specific exemption regarding Social Security and Medicare taxes. Because the church views Social Security as a commercial insurance program that violates biblical mandates for church-led elder care, Congress granted a narrow exemption for self-employed Amish members under IRS Form 4029.