Rules Are for Schmucks: Did the Dog Eat the IRS’s Homework?
The Freedom From Religion Foundation (FFRF) recently announced a settlement in which the IRS agreed to re-initiate enforcement of a federal law that has been on the books for sixty years, and enforced by every administration prior to this one.
Someday. When they get around to it.
The law in question, sometimes called the “Johnson Amendment,” is simple and short. It says that a tax-exempt organization under Internal Revenue Code section 501(c)(3) may not engage in political activity, such as endorsing or opposing candidates for office, or advertising on their behalf. There are around a million 501(c)(3) organizations in the United States, including churches, charities, and educational organizations like the American Humanist Association (AHA). Having 501(c)(3) status means that the organization itself does not pay tax on its income, and that donations to it are tax-deductible for the donor.
So, if you give money to a political candidate or a political action committee (PAC), you get no tax deduction for it. If you give money to the AHA (the more the better!), you do.
Now, if the AHA were allowed to use its tax-deductible contributions to campaign for political candidates, that would be a bit of a loophole, no? Anyone who wanted to support a candidate that AHA liked could just give tax-deductible contributions to AHA, rather than non-deductible contributions to the candidate, and save a ton of money. Even a naïf like me is smart enough to figure that one out. How tickled would the Koch brothers be to get tax deductions for the $18 million they’ve poured into political campaigns in recent years? Not to mention the greater ease with which they could disguise their role? Hence, the Johnson Amendment, which until a few years ago was non-controversial. Eighty-seven percent of Protestant ministers on a 2012 survey oppose church endorsements of candidates, as do two-thirds of the general public.
To hear the Christian Right today, though, you’d think the Johnson Amendment is “The End of Religion as We Know It.” It “muzzles” pastors, it negates their constitutional right of free speech, it treats them worse than every other citizen, it puts IRS censors in the churches, blah, blah, blah. It has even sparked a massive campaign of deliberate civil disobedience. On what was called Pulpit Freedom Sunday in 2012, over 1,500 preacher scofflaws explicitly endorsed candidates from their pulpits, and dared the IRS to do something about it. A steadily growing group has been doing the same thing, every year, since 2008.
The response to this provocation from the IRS? Mousy acquiescence. Not a single enforcement action brought, even against those preachers with the insolence to mail recordings of their violations to the IRS. The George W. Bush administration launched dozens of investigations of Johnson Amendment violations; the Obama administration, not even one.
The stated reason for this dereliction of duty makes “the dog ate my homework” sound plausible by comparison. In 2009, one of the cases brought by the Bush administration (against a pulpit endorsement of Michelle Bachmann) lost in court on a hyper-technicality, relating to the fact that the investigation hadn’t been internally approved by an IRS official of sufficiently high rank. It shouldn’t take a Master of Public Administration to figure out how to correct this deficiency going forward. “Boss, could you sign this?” would presumably play a big role in any fix. It should take about five minutes to work out an acceptable procedure. Yet here we are five years later, and the IRS is claiming to be totally flummoxed by this brain-bending problem.
I practiced tax law for thirty years. More than once, when I saw sharp operators in my little niche promote clever new schemes to flout the intent of the law, the IRS was on it quicker than ants at a picnic, with new regulations, ominous warnings, and, in one case, legislation retroactive to the date of its announcement. So what’s going on with the Johnson Amendment? Are IRS officials lazy? Incompetent? Or is it something else?
I cannot read minds, and I have no access to inside information, but my vote is for “something else.” Politicians have long respected the political clout of black preachers in the black community. In 2012, for example, pollsters found that 40 percent of black Protestants who attend worship services regularly said their clergy have discussed a specific candidate in church—and the candidate in every instance was President Barack Obama. Obama’s longtime top advisor, Valerie Jarrett, delivered a Johnson Amendment-violating partisan blast against Republican congressmen from the pulpit of Atlanta’s Ebenezer Baptist Church in 2010. In 2012 Elizabeth Warren welcomed endorsements from Boston’s black political preachers in Roxbury’s Twelfth Baptist Church at a critical moment in her campaign. Obama himself defeated Hillary Clinton by a hair’s-breadth in the 2008 primaries—without the record-shattering black turnout, especially in the southern states, he would have lost. Would he have gotten that turnout without the strenuous political efforts of black churches?
Obama wrote in The Audacity of Hope that keeping religion out of politics “is bad politics.” So was he, or was he not, personally involved in what appears to have been a conscious decision to trash this law? I suspect he was, but I can’t prove it.
Anyway, FFRF brought a suit to demand that the IRS start doing its job. In July the suit was settled, after the IRS informed FFRF that it now had a “protocol” in place for handling these cases. However, sad to say, it can’t actually start doing anything with its lovely new protocol because of yet another “moratorium” on tax-exempt enforcement activity relating to allegations of politicization of the IRS tax-exempt office, involving mysteriously-disappearing emails and the like. So, just like for the last five years, no enforcement of the Johnson Amendment is going to be happening soon.
What does this new protocol actually say? What are the procedures going to be, if they ever actually start? Sorry, that’s classified. The Alliance Defense Fund has had to file a Freedom of Information Act request for details of what it quite accurately calls a “secret deal,” and the Attorney General of Oklahoma is trying to use the authority of his office to get some transparency as well. Where’s Julian Assange when we need him?
It’s a strange feeling to be rooting for the success of the Alliance Defense Fund, normally the nation’s leading advocate for brazen religious special privilege. While I’m on a roll, let me also say something nice about Mike Huckabee, who told an audience of ministers: “I think we need to recognize that it may be time to quit worrying so much about the tax code and start thinking more about the truth of the living God, and if it means that we give up tax-exempt status and tax deductions for charitable contributions, I choose freedom more than I choose a deduction that the government gives me permission to say what God wants me to say.” Huckabee added that it may be time for churches to say, “Keep your deductions. Keep the exemptions. We stand more faithful with what God would have us to say, and we choose our freedom more than our financial benefit.”
It truly is disconcerting to picture IRS investigators, even honest ones, standing in the backs of churches to monitor whether a preacher’s sermon, e.g., on the morality of abortion, somehow crosses a line of being “too political.” The best way to avoid that, while maintaining the integrity of the tax code, is to get rid of the tax exemption for churches. As Huckabee put it, “If you’ve got people in your church who are giving because it’s a tax decision, then they ought to keep their money. They need it more than God does.”