Suit Filed against IRS for failing to enforce Church Electioneering ban

[Flash Walken]

The Freedom From Religion Foundation is taking the Internal Revenue Service to court over its failure to enforce electioneering restrictions against churches and religious organizations, calling it a violation of the Establishment Clause of the First Amendment and of FFRF’s equal protection rights. FFRF filed the lawsuit today in U.S. District Court for the Western District of Wisconsin. (View the lawsuit here.)

A widely circulated Bloomberg news article quoted Russell Renwicks, with the IRS’ Tax-Exempt and Government Entities division, saying the IRS has suspended tax audits of churches. Other sources claim the IRS hasn’t been auditing churches since 2009. (See AP Religion Writer Rachel Zoll’s story, “IRS Not Enforcing Rules on Churches and Politics.”) Although an IRS spokesman claimed Renwicks “misspoke,” there appears to be no evidence of IRS inquiries or action in the past three years.

As many as 1,500 clergy reportedly violated the electioneering restrictions on Sunday, Oct. 7, 2012, notes FFRF’s legal complaint. The complaint also references “blatantly political” full-page ads running in the three Sundays leading up to the presidential elections by the Billy Graham Evangelical Association.

FFRF, a state/church watchdog based in Madison, Wis., is asking the the federal court to enjoin IRS Commissioner Douglas Shulman from continuing “a policy of non-enforcement of the electioneering restrictions against churches and religious organizations.”

Additionally, FFRF seeks to order Shulman “to authorize a high-ranking official within the IRS to approve and initiate enforcement of the restrictions of §501(c)(3) against churches and religious organizations, including the electioneering restrictions, as required by law.”

...

This non-enforcement “constitutes preferential treatment to churches and religious organizations that is not provided to other tax-exempt organizations, including FFRF,” the complaint notes. “Churches and religious organizations obtain a significant benefit as a result of being non-exempt from income taxation, while also being able to preferentially engage in electioneering, which is something secular tax-exempt organizations cannot do.”

This preferential tax exemption involves more than $100 billion annually in tax-free contributions to churches and religious organizations in the United States.

http://ffrf.org/news/news-releases/i...tioneering-ban

NEW YORK — For the past three years, the Internal Revenue Service hasn’t been investigating complaints of partisan political activity by churches, leaving religious groups who make direct or thinly veiled endorsements of political candidates unchallenged.

The IRS monitors religious and other nonprofits on everything from salaries to spending, and that oversight continues. However, Russell Renwicks, a manager in the IRS Mid-Atlantic region, recently said the agency had suspended audits of churches suspected of breaching federal restrictions on political activity. A 2009 federal court ruling required the IRS to clarify which high-ranking official could authorize audits over the tax code’s political rules. The IRS has yet to do so.

http://www.washingtonpost.com/busine...76a_story.html

[Hemi-Cuda]

good, it was ridiculous how churches were getting away with political endorsements with zero consequences

[bizaro86]

Maybe I don't get this, or it's different in the US. Are political donations tax deductible there?

In Canada, political donations are better tax wise than donations to a religious organization.

[old-fart]

Churches should absolutely be able to have opinions and be able to say whatever it they want. Having said that, if they want to stick their nose into politics, they should lose their tax exempt status.

Simple.

[bizaro86]

Originally Posted by old-fart

Churches should absolutely be able to have opinions and be able to say whatever it they want. Having said that, if they want to stick their nose into politics, they should lose their tax exempt status.

Simple.

By that logic, shouldn't we take away tax exempt status from political parties?

[gargamel]

Originally Posted by bizaro86

Maybe I don't get this, or it's different in the US. Are political donations tax deductible there?

Political donations are not tax deductible in the U.S. That's what makes the $300 million spent by Karl Rove's super PAC on losing candidates even more hilarious.

[bizaro86]

Originally Posted by gargamel

Political donations are not tax deductible in the U.S. That's what makes the $300 million spent by Karl Rove's super PAC on losing candidates even more hilarious.

Ahhh.. That makes sense then. Obviously if someone is calling a political organization a "church" for the purpose of making campaign contributions a tax deduction, that's an issue.

It's always irked me that a donation to (usually well off) politicians gets better tax treatment than a donation to an actual charity here in Canada. Sounds like thats an election financing rule the US got right.

[GP_Matt]

Originally Posted by bizaro86

It's always irked me that a donation to (usually well off) politicians gets better tax treatment than a donation to an actual charity here in Canada. Sounds like thats an election financing rule the US got right.

That is only true for a small donation. I don't remember the actual numbers, but for provincial donations in Alberta you get the best tax break for $200 or less. Every dollar over 200 has a lower deduction and I think the max is $1000 with everything over that earning no deduction.
Compare that to charitable donations where every dollar gets the same treatment whether you give $200 or $2000000. Katz would have received a much bigger tax refund if he had given the money to a charity.

[GGG]

I would need to see if they are treated the same as other non-profit or charitable organizations. Planned Parenthood endorses candidates so as long as churches and planned parenthood are treated similarly under tax and election law than I don't have any issues. If they are treated differently then this case has merit.

Also are union dues tax deductable in the states like they are in Canada because if they are then I think the same requirments should apply to them as well. Again no idea if they do or not.

The goal should be to have all organizations that revcieve tax excempt status treated the same when incomes to making politcal spending.

[evman150]

Why on Earth are churches still not taxed?

[gargamel]

Originally Posted by GGG

I would need to see if they are treated the same as other non-profit or charitable organizations. Planned Parenthood endorses candidates so as long as churches and planned parenthood are treated similarly under tax and election law than I don't have any issues. If they are treated differently then this case has merit.

Planned Parenthood and the Planned Parenthood Action Fund are technically separate entities. The Planned Parenthood Action Fund engages in political activities, but Planned Parenthood itself does not. This allows donations to Planned Parenthood to be tax deductible while donations to the Planned Parenthood Action Fund are not.

Under the same reasoning, Catholic bishops could create a non-tax exempt Catholic Action Fund that could endorse candidates, but funds could not be shared between the Catholic Church and the Catholic Action Fund.

[GGG]

Originally Posted by evman150

Why on Earth are churches still not taxed?

Are community associations taxed? If a community association is taxed on any buildings or land it owns than I would agree with you that churches should be taxed.

Otherwise a church is somewhere between a charity, a political party, or a community association.

[photon]

I don't think churches have to be taxed completely, just make them report what portions of their income are used for charitable actions and such. Feeding homeless people, that part is tax exempt. Replacing your 51 foot Jesus statue that got burned down by lightning? Not tax exempt. Running a youth center to give kids something to do? Tax exempt. Hanging Obama in effigy on the front lawn of the church. Not tax exempt. (Both of those are real examples incidentally).

Then they can say whatever they want from their non-tax exempt crystal church pulpit.