IRS Warns Tax-Exempt Churches About Electioneering

The Internal Revenue Service in April issued a presidential election-year advisory to non-profit groups, including houses of worship, reminding them to refrain from politicking or risk losing their tax-exempt status.

"Organizations described in section 501(c)(3) of the Code that are exempt from federal income tax are prohibited from participating or intervening in any political campaign on behalf of, or in opposition to, any candidate for public office," the April 28 advisory observes. "Charities, educational institutions and religious organizations, including churches, are among those that are tax-exempt under this code section."

The IRS advisory, similar to ones issued in 1992, 1996 and 2000, goes on to note that non-profit groups "cannot endorse any candidates, make donations to their campaigns, engage in fund raising, distribute statements, or become involved in any other activities that may be beneficial or detrimental to any candidate."

Churches and other non-profits can, however, address political, social and moral issues. The IRS advisory reminds non-profit groups that the prohibition is limited to endorsement or opposition of candidates.

"Whether an organization is engaging in prohibited political campaign activity depends upon all the facts and circumstances in each case," the advisory states. "For example, organizations may sponsor debates or forums to educate voters. If the debate or forum shows a preference for or against a certain candidate, however, it becomes a prohibited activity."

The federal tax agency warns that non-profits could lose their exempt status if they do engage in partisan politicking.

Religious Right organizations, including the National Religious Broadcasters, have been lobbying Congress for a number of years now to alter the IRS Code to allow churches to become more engaged politically. U.S. Rep. Walter B. Jones (R-N.C.) has tried to push a bill through Congress that would change the rules for religious groups, allowing them to endorse politicians. (See "Pulpit Politics," February 2004 Church & State.)