Opinion Page: IRS Must Enforce 501(c)(3) Limits for Religious Groups, Charities

From Bloomberg Tax:

In the quid pro quo between the state and the charity or religious organization, the state effectively compels organizations—that believe intervening in politics is part of their charity or faith—to risk a benefit that they have grown to depend on. They can’t compete as taxable entities in a market dominated by tax-exempt organizations.

The IRS should spend some of its additional enforcement funds cracking down on politicking from the tax-exempt podium or pulpit, and the Fervent example seems like an excellent place to start. The quid pro quo of tax-exempt status for a restriction on political campaign involvement requires vigilant and active enforcement. The restriction, which requires revenue procedures that lay out hypothetical scenarios for clarity, merely creates a cottage industry for organizations that can engage in semantics.

Most tax-exempt organizations seeking to test the boundaries on political involvement aren’t as brazen as Fervent Calvary’s Pastor Jimmy Morales [For prior coverage see here.]. They don’t campaign for a given candidate, and they certainly don’t hold a rally in their building. They merely take a side on an issue that’s only in the public discussion owing to a given candidate’s position, and they espouse a position on a given issue that eliminates all candidates or parties save for one. The intervention and participation is attenuated, and their politicking more subtle.  In the organizations’ view, it seems clear that modern nonprofit and religious values very much involve political issues. Organizations that walk right up to the line—as well as those such as Fervent Calvary, which seem to pretend the line doesn’t exist—make it clear through what they are risking that political matters are extremely important to them in their work. They will risk their very existence to make their point.

Examples of non-religious tax-exempt organizations risking status to further their policy work are just as common. Take the think tank Texas Public Policy Foundation of Austin, which last year held a “victory summit” and purportedly invited only Republican candidates to speak. This resulted in calls from watchdog groups for an IRS investigation into the summit—there’s been no word of action taken by the IRS.

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darryll k. jones