Potential Change to Ban Created by Johnson Amendment

Bloomberg reports that a new bill (H.R. 6195) has been introduced that would allow 501(c)(3) organizations to make statements about political campaigns, if the statements “are made in the ordinary course of carrying out its tax-exempt purpose.” Many believe this exemption is overly broad, creating issues with enforcement. Ms. Kinglsey, a Washington attorney, stated that “you’re creating a loophole for people to drive a truck through . . . .” A particular concern related to broadness comes with the lack of a definition of what exactly is an organization’s “regular and customary activities.” Under the bill, a 501(c)(3) organization could not hold a specific fundraiser for a candidate, but they could encourage their constituents to donate to political candidates.

To abate the possibility of an influx of financial donations, the bill states that organizations may not incur more than “de minimis incremental expenses” in the process of making a political statement.

Many church leaders believe they have a fundamental right to voice their political opinion. Erik W. Stanley, senior counsel at Alliance Defending Freedom, said “No tax exemption can be based on a requirement that a church or any other non-profit organization give up a constitutionally protected freedom, including free speech. With regard to churches, they can decide for themselves what they should or shouldn’t say from the pulpit.”

Will Congress view this proposal as a necessary expansion of speech, or as an overly difficult rule to enforce?

David Brennen