Churches Sue IRS For Not Letting Them Say How Jesus Wants You To Vote

And claim a double tax deduction while doing it.

In 2016, evangelical Christians put Donald Trump in the White House. Seventy-eight percent of “Bible believing,” “family values” Protestants pulled the lever for a philandering gameshow host who bragged on tape about sexually assaulting women. This turned out to be a pretty good investment, since Trump immediately paid them back by appointing three Supreme Court justices willing to finally overturn Roe v. Wade and obliterate the separation of church and state.

Evangelicals showed up for Trump in 2020 in even larger numbers, although it wasn’t enough to keep him in power. Recently Trump promised Christians that if they vote for him this time, “in four years, you don't have to vote again. We'll have it fixed so good, you're not gonna have to vote." Liberal commentators condemned this as an admission that Trump intends to overturn democracy. But the most parsimonious explanation is that he was vowing to rig the game so thoroughly that religious conservatives will get everything they want from the judiciary, without having to worry about who gets elected.

Conservatives are already planning for such a future, filing lawsuits today that will land on the Supreme Court’s doorstep in a few years. And one thing the religious right very much wants is to get rid of the “Johnson Amendment,” a provision in the tax code that bans political activities by certain tax-exempt entities, notably churches.

Hey, hey, LBJ

In 1954, then-Senator Lyndon B. Johnson introduced an amendment to Section 501 of the Internal Revenue Code which exempted from taxation any organization established “exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition … or for the prevention of cruelty to children or animals.”

The price of this preferential tax treatment was a modest form of political neutrality. Under § 501(c)(3), qualifying organizations may not “participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.”

To be clear, that is absolutely not a blanket restriction on political speech; it’s a narrow restriction on political lobbying for or against a candidate for public office. A 501(c)(3) organization, including a church, is free to take positions on political hot-button issues. The only thing it can’t do is endorse or oppose a candidate.*

But what if your organization really wants to lobby for or against a particular candidate? Good news!

The very next subsection, 501(c)(4), covers organizations “operated exclusively for the promotion of social welfare” that do want to endorse candidates. They don’t have to pay taxes on their donations, either. The only salient difference is that individual donations to a 501(c)(4), like donations to a political campaign itself, are not tax-deductible.

That’s the bargain we’ve all agreed to for the past 70 years. We don’t tax 501(c)(4)s, but we don’t subsidize them by allowing donors to deduct their contributions to political organizations from their taxable income.

Thus, for example, Planned Parenthood For America is a tax-exempt 501(c)(3) organization. Its position on abortion is well-known. But when it comes time to lobby, endorse, or oppose specific political candidates, those activities are undertaken by the Planned Parenthood Action Fund, a companion 501(c)(4) to which your donations are not tax-deductible.

But now the Christian right would like to change that, albeit only for explicitly right-wing religious groups.

Existing Laws Already Privilege Religious Organizations

A truly bizarre feature of American life is that a majority of the country’s Christians feel they are persecuted for their religious beliefs, with Evangelicals claiming they face “a lot” of discrimination.

Which is true — but not in the way that they think. In fact, the tax code discriminates in favor of religious organizations at every turn.

A secular organization must first gain IRS approval to qualify as a 501(c)(3), and then file an annual, public report, known as IRS Form 990, identifying its contributions, expenditures, charitable activities, management structure, and employee compensation.

In contrast, religious organizations are automatically approved for 501(c)(3) status under a separate provision in the Internal Revenue Code, 26 U.S.C. § 508(c)(1), which exempts “churches, their integrated auxiliaries, and conventions or associations of churches.” And they don’t have to fill out a 990 either.

In other words, unlike secular charities, an organization that calls itself a church does not need to swear under penalty of perjury that it is doing actual charitable work. Nor need it produce any documentation whatsoever that might allow the IRS (or any third party) to evaluate whether it is, say, spending hundreds of millions of donor dollars on a fleet of private jets to chauffeur around the pastor.

And by the by, “integrated auxiliaries” is a pretty broad catch-all term. Under the IRS guidelines, it applies to any entity religious organization “affiliated with” a church or convention or association of churches that receives financial support "primarily” from church sources. So lots of crazy right-wing Christian organizations (so-called “parachurch ministries”) also automatically qualify for 501(c)(3) status even though they have no congregants or services.

And unlike secular non-profits, churches are also virtually immune from an IRS audit, thanks to 26 U.S.C. § 7611, which requires sign-off from the Secretary of the Treasury (or one of the Secretary’s regional direct reports) before conducting any investigation of any kind into a church’s tax-exempt status, even if the agent suspects fraud. Plus the code also shortens the lookback period for churches and religious organizations from seven years to just three.

We should all be so discriminated against!

Whiners v. IRS

Conservatives have wanted to get rid of the Johnson Amendment for decades. They claim that the law isn’t enforced against secular and liberal church groups, but is enforced against them. They’re half-right (but wholly lying) about this. In reality, the Johnson Amendment isn’t enforced against anybody.

Churches endorse candidates all the time, and the IRS never does anything about it. The wingnuts over at the Alliance Defending Freedom even organize an annual event called “Pulpit Freedom Sunday,” in which pastors break the law by endorsing from the pulpit and send a video of said law-breaking to the IRS, after which the ADF publishes the names of those lawbreakers its own website. They’ve been doing this since 2008.

The entire purpose of this exercise is to bait the IRS into actually revoking a church’s tax-exempt status, thereby creating a plaintiff with standing to challenge the Johnson Amendment in court. But after 16 years, they’ve got nothing, because it never happened.

Eventually, the ADF got tired of waiting — or maybe they just figured the judiciary was finally stocked with enough FedSoc weirdos that standing didn’t matter anymore. Last week they filed a complaint in the Eastern District of Texas arguing that the Johnson Amendment discriminates against the free speech rights of “Christian organizations that embrace a biblical worldview” and therefore must be struck down for violating the First Amendment (or, alternatively, the Fifth and Fourteenth Amendments, and/or the Religious Freedom Restoration Act).

The case is captioned National Religious Broadcasters v. Werfel, and the lead plaintiff bills itself as “the World’s Largest Association of Christian Communicators.” The NRB is joined by another terrifying right-wing group called Intercessors for America, along with two churches actually located in the Eastern District of Texas, so as to ensure that the trial judge would be one of Sen. Mitch McConnell’s purpose-picked hardliners. The defendant is IRS Commissioner Brad Werfel, and, rounding out the cast of characters, is the plaintiffs’ attorney Michael Farris, the former president, CEO, and general counsel of ADF.

As planned, the case was assigned Judge J. Campbell Barker, a Trump appointee who has enjoined multiple executive actions by the Biden administration. But this case is so preposterously stupid it may be a bridge too far for even the Trumpiest judge, and possibly even the Fifth Circuit.

Standing, or Whatever

Back in the days when law was real, a plaintiff had to allege that he/she/it had been harmed or was about to be. That’s why ADF spent 16 years trying to goad the IRS into enforcing the Johnson Amendment. But no one, including any of the plaintiffs here, has had their tax exempt status revoked by the IRS for endorsing a political candidate.

Indeed they have all managed not to violate the provisions of the Internal Revenue Code which they agreed to abide by when they applied for tax-exempt status.

“None of the Plaintiffs have heretofore violated the Johnson Amendment,” they concede, but they have all “engaged in self-censorship to avoid doing so and incurring the commensurate penalties provided in the IRC.”

(The Complaint does allege that the IRS “levied a tax penalty” on Cornerstone Chapel in 2020 for preaching an “election sermon,” but I can find no proof that actually happened. In any event, Cornerstone didn’t join the lawsuit and you can’t sue on someone else’s behalf.)

But they claim that they have suffered an injury because their speech has been chilled by the law and “the threat of future enforcement of the Johnson Amendment is substantial.”

That last bit is a lie, as Farris knows perfectly well.

And Speaking of Whoppers …

Having yaddayaddayadda-ed over the part where the plaintiffs are actually harmed, they continue with a truly bizarre claim that exempting churches from the obligation to qualify as a charity is somehow discriminating against them:

Churches are placed in a unique and discriminatory status by the IRC. [They] need not apply to the Internal Revenue Service to obtain recognition of their 501(c)(3) status. The Code places them automatically within the ambit of 501(c)(3) and thereby silences their speech, while providing no realistic alternative for operating in any other fashion. Churches have no choice; they are automatically silenced vis-à-vis political candidates.

That’s crazy. Churches are perfectly free not to register as tax-exempt organizations with the IRS at all, or to register under § 501(c)(4) — both of which are pretty obvious “realistic alternatives.” What the NRB mean is that they can’t continue to get their unaudited double bonus tax exemption and shill from the pulpit.

Most of the rest of the complaint — a full 26 pages out of a 53-page document — is devoted to listing every example they can find of liberal churches endorsing Democratic candidates and not getting their tax-exempt status revoked.

Then comes a section ostensibly proving that the IRS is “targeting conservative nonprofits for unfavorable treatment.” It’s four paragraphs long, and highlights just three incidents:

1. Jeff Sessions announcing a settlement in 2017 with conservative “Tea Party” groups that claimed they were subject to targeted IRS investigations;

2. The unsourced claim about Cornerstone Chapel, which is not a plaintiff; and

3. An interim denial of 501(c)(3) status to a group called “Christians Engaged” that was reversed by the Commissioner.

That’s pretty thin gruel.

The plaintiffs also whine about the unfairness of allowing college newspapers to endorse candidates, capped off with the bizarre claim that most commercial newspapers are 501(c)(3) organizations (they’re not) and so it is NO FAIR that they’re allowed to make endorsements.

It’s a breathtakingly disingenuous filing which ought to be tossed out of court on standing alone. But the Christian right is betting that Donald Trump’s check will clear. And they might well be right.

* This post is for entertainment purposes, does not form an attorney-client relationship and does not constitute legal advice. Don’t take legal advice from a newsletter!