TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Sunday, April 22, 2018

When Is A Church Not A Church For Tax Purposes?

New York Times op-ed:  When Is a Church Not a Church?, by Katherine Stewart:

Now that tax day is upon us, consider that through the miracle of tax breaks some of your tax dollars will effectively be going to support groups that finance campaigns against same-sex marriage and gun safety. A number of these groups are also entitled to raise money from other sources for political purposes, without filing the disclosures that are required of other individuals and entities. Why? They’ve got God on their side.

Last fall, for example, according to forms filed with the Internal Revenue Service, Focus on the Family, a conservative Christian organization that promotes socially conservative views on matters of public and family policy, declared itself a church.

Focus on the Family doesn’t have a congregation, doesn’t host weddings or funerals and doesn’t hold services. What it does do, with its nearly $90 million annual budget, is deliver radio and other programming that is often political to an estimated audience of 38 million listeners in the United States and beyond. It has funded ads against state legislators who support bills intended to prevent discrimination against L.G.B.T. people and it leads programs to combat what it calls “gay activism” in public schools.

Why would such a group want to call itself a church? Short answer: money. Churches can raise tax-deductible contributions more easily, and with fewer restrictions, than other nonprofits can. They also enjoy additional tax shelters, such as property tax exemptions for clergy members — or was that conservative radio personalities? ...

When challenged about their blatantly partisan activism, these groups invariably cry out that their religious liberty is under attack. It isn’t. They are welcome to their opinions and free to expose them to the sunlight of the public square. The real issue here is money and transparency. Tax breaks don’t come free; they’re just ways in which the government allocates your tax money. And if the government is going to allocate money in a certain direction, you should be able to see where it’s going.

The process corrupts religion, too. Religion has long thrived in America because most religious leaders respected the separation of church and state, an arrangement that has served our country very well. Under our current law, religious groups are exempt from certain tax and reporting burdens. Political groups are not. Churches need to decide which one they are.

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