I spent a great deal of time searching for an answer to this that doesn't make it sound like a scam to avoid taxes and enjoy the benefits of being treated as a religious institution, but I couldn't. As is usually the case, it's a lot easier to find information from those that stand against the Jehovah's Witnesses than it is to find positive information about them.
According to outsiders it's little more than a tax dodge as stated in these first few links.
However... The most complimentary description was found in a legal document from the Oregon Judicial Department Apellate Court This seems a little less inflammatory. It describes them as people that have simply dedicated themselves to ministry, and therefore would function in a way that assists the Church. As such, their right to tax-exempt status is less clear.
However, this question isn't (as far as I know) about their tax-free status, but about what they are, and what their function is. Unfortunately, the following is the best, least inflammatory description I could find. Since they don't have information about themselves online anywhere, this is what I'm settling for providing. It's not first-hand from them, but presumably it's based on first-hand interviews with lawyers that are familiar with the defendants. It's better than nothing.
Before explaining the particular facts of this case, it is helpful to
give some background information on the organizational structure of
Jehovah's Witnesses. Jehovah's Witnesses worship within congregations,
each of which meets within a Kingdom Hall. (2) Each congregation of
Jehovah's Witnesses is located within a circuit. Taxpayer, for
instance, is one of approximately 22 congregations located within
Oregon Circuit 6, which stretches from Beaverton to the coast and from
Tillamook to Astoria. (3) Congregations are led by Elders and
Ministerial Servants, both of whom are volunteers and generally have
secular employment. Elders minister to other congregation members and
train Ministerial Servants to assume increasing responsibility within
the congregation and larger organization of Jehovah's Witnesses.
Higher up in the organizational structure, Jehovah's Witnesses are led
by members of the Worldwide Order of Special Full-Time Servants of
Jehovah's Witnesses (the Order). Members of the Order take vows of
obedience and poverty, eschew secular employment, and dedicate their
lives to overseeing and directing the spiritual needs of Jehovah's
Witnesses. In return, the Order promises its members housing and a
minimal stipend to cover living expenses. There are several types of
Order members, including Circuit Overseers and Special Pioneers.
Circuit Overseers live within the circuit to which they are assigned
and work with congregation leaders to meet the needs of each
congregation. Specifically, Circuit Overseers supervise the work of
Elders and Ministerial Servants by annually traveling to and spending
at least a week with each congregation within the circuit. Circuit
Overseers usually stay in the homes of local Jehovah's Witnesses as
they travel from congregation to congregation. Substitute Circuit
Overseers, who fill in for Circuit Overseers when they are temporarily
unable to fulfill their duties, are rarely Order members, but instead
are usually secularly employed Jehovah's Witnesses. Regarding Special
Pioneers, the only kind relevant to this case are those who are on
infirm status. Special Pioneers on infirm status, few in number, are
often ex-missionaries. They generally do not travel but rather stay
with one congregation and serve that congregation, as well as the
circuit and religion as a whole. However, few congregations have a
Special Pioneer, whether on infirm status or not, assigned to them.