Part-I Tax-exempt lobbying
The Presbyterian Church recently made a lot of
self-righteous noise about those Bad Guns. You know, the ones
that Hurt People just by being in your closet. The Terrys ask a
very pertinent question. Why isn't the IRS also asking it?
Recent news stories concerning the Presbyterian Church's anti-Bill of Rights policies concerning gun ownership prompted me to request information regarding their position from the "Criminal Justice Program" of the Presbyterian church.
In a document entitled "Public Policy Statements of the Presbyterian Church (U.S.A.)" are found the following statements and recommendations concerning gun control:
The108th assembly of the PCUS advocated effective control;
The 202nd General Assembly (1990) of the Presbyterian Church(USA) supports gun control at the federal, state and local levels… support of assault weapon control… and opposition to the use of deadly force by individuals in defense of property.
Calls upon the United States Government to establish meaningful and effective legislation to regulate the importation, manufacture, sale and possession of guns and ammunition to the general public.
Urges the enactment of similar state and local laws…
Directs… [communication of] this resolution to the congress and the President….
Requests the denomination's Washington Office to…develop model legislation and guidelines for implementation.
Directs this statement to be widely published and sent to state governors, members of Congress, and the administration from whom we urge some commonsense legislation…
The Presbyterian church therefore, according to its policy statement, and according to IRS Publications 557 and 1828, is involved in lobbying. IRS Publication 557 states in pertinent part:
In general, if a substantial part of the activities of your organization consists of carrying on propaganda or otherwise attempting to influence legislation, your organization's exemption from federal income tax will be denied. However, a public charity (other than a church, an integrated auxiliary of a church or of a convention or association of churches, or a member of an affiliated group of organizations that includes a church, etc.) may avoid this result.
These elective provisions for lobbying activities by public charities do not apply to a church, an integrated auxiliary of a church or of a convention or association of churches, or a member of an affiliated group of organizations that includes a church, etc., or a private foundation.
Tax on organization. Organizations that lose their exemption under section 501(c)(3) due to lobbying activities generally will be subject to an excise tax of 5% of the lobbying expenditures.
IRS Publication 1828 provides the following:
"WHAT ARE THE RESTRICTIONS ON LEGISLATIVE ACTIVITY THAT MAY BE ENGAGED IN BY CHURCHES?
In general, no organization, including a church, may qualify for tax-exempt status as a charitable organization if a substantial part of its activities is attempting to influence legislation.
Whether an organization's legislative activity constitutes a "substantial part" of its overall activities is determined on the basis of all the pertinent facts and circumstances in each case. Consideration is given to a variety of factors including the time devoted by the organization to the activity (by both compensated and volunteer workers), assets devoted to the activity (such as office space, machinery, etc.), as well as expenditures.
WHAT CONSTITUTES "ATTEMPTING TO INFLUENCE LEGISLATION"?
An organization will be regarded as "attempting to influence legislation" (commonly known as "lobbying") if it contacts, or urges the public to contact, members of a legislative body for the purpose of proposing, supporting, or opposing legislation, or if the organization advocates the adoption or rejection of legislation.
Organizations may, however, involve themselves in issues of public policy so long as the involvement does not result in attempts to influence legislation that constitute a substantial part of their activities..
WHAT CONSTITUTES "LEGISLATION"?
'Legislation' includes action by the Congress, any state legislature, any local council or similar governing body, or by the public in a referendum, initiative, constitutional amendment, or similar procedure.
The election to use the "expenditure" test is made by filing Form 5768, Election/Revocation of Election by an Eligible Section 501(c)(3) Organization to Make Expenditures to Influence Legislation, during the tax year for which it is to be effective. The election remains in effect for succeeding years until it is revoked by the organization. By law, churches may not make this election and thus are covered under the substantial part test.
WHAT ARE THE CONSEQUENCES THAT RESULT FROM EXCESSIVE LEGISLATIVE ACTIVITY?
An organization that continues to lobby on an excessive basis may lose its tax exemption under section 501(c)(3). If an organization loses its status as a tax-exempt charitable organization because it engages in excessive legislative activity, it may not thereafter qualify for exemption as a social welfare organization under section 501(c)(4).
Is this limitation on lobbying constitutional? Courts have long held that government should not subsidize partisan, political advocacy under the guise of educational activities. Taxation without Representation of Washington v. Regan, 676 F.2d 715, 736 (D.C. Cir 1982). Taxpayers should not subsidize efforts at political advocacy or lobbying. Christian Echoes National Ministry v. United States, 470 F.2d 849 (10th Cir. 1972); see also Regan v. Taxation With Representation of Washington, 461 U.S. 540 (1983). "The limitations in section 501(c)(3) stem from congressional policy that the United States Treasury should be neutral in political affairs and that substantial activities directed to attempts to influence legislation or affect a political campaign should not be subsidized." Christian Echoes, 470 F.2d at 854.
In its aggressive move to disarm the American public, the Presbyterian Church is clearly involved in a tax-free effort to demolish the Bill of Rights, and it boldly claims to have been involved in this effort since 1968, in clear violation of its 501(c)(3) status. The Church is still today proceeding with this effort, apparently with the blessings of the IRS and Congress, and because of its tax-free status, it is being subsidized by the taxpayers to do so. Tax-exempt, pro-Second Amendment organizations, such as NRA, cannot lobby and retain their tax-exempt status, so NRA employs the NRA Institute for Legislative Action as its lawful lobbying arm. In such capacity, donations to the NRA-ILA are not tax deductible.
However, the IRS takes the liberty, at its discretion, of overlooking the unlawful lobbying activities of certain churches. During the 1988 presidential campaign, Reverend Jesse L. Jackson took up collections at churches around the country. See "I.R.S. Is Urged to Investigate Jackson's Church Collections," N.Y Times at B6 (Feb. 17, 1988). It appears that the tax-exempt status of the churches at which Reverend Jackson collected campaign funds is still unchallenged by IRS.
Such activities of IRS apparently even have the blessings of some courts. In 1980, two days before Massachusetts' congressional primary, Boston's Roman Catholic Archbishop issued a letter that was read from the pulpits throughout the state urging Catholics not to vote for pro-choice candidates. See Anthony Lewis, Religion and Politics, N.Y Times at A31 (Sept. 17, 1980). Pro-choice activists subsequently brought an unsuccessful action seeking to force the Department of the Treasury to revoke the Catholic Church's tax exemption. See Abortion Rights Mobilization v. Regan, 544 F.Supp. 471 S.D.N.Y 1982). The Second Circuit, in a 2-to-1 decision, ruled on remand from the Supreme Court that Abortion Rights Mobilization, Inc. did not have standing to challenge the IRS' recognition of tax-exempt status to the Catholic Church. However, for purposes of analyzing the standing issue, the court accepted the plaintiffs' allegations that the Catholic Church has repeatedly violated section 501(c)(3)'s prohibition on political campaigning by endorsing pro-life political candidates and by opposing pro-choice candidates. In addition, the court accepted that the IRS knew about the Catholic Church's politicking and had chosen to ignore it rather than revoke the Church's tax-exempt status.
Finally, in 1992, IRS issued a warning to, but did not revoke the tax exempt status of, the Jimmy Swaggart Ministries for its endorsement of Reverend Pat Robertson for president in 1986. See "Jimmy Swaggart Ministry Admits Tax Law Violation," L.A. Times at F17 (Feb. 1, 1992)
Unfortunately, it seems that the
only type of political activity which IRS selectively prosecutes
is that which is adverse to political correctness or the current
administration. On October 30, 1992, four days before the
presidential election, Branch Ministries, Inc., doing business as
the Church at Pierce Creek, and Pastor Dan Little, the pastor of
the Church at Pierce Creek, bought advertising space in The
Washington Times and USA Today to print an open letter. The
letter, which was headed "Christian Beware," described
then-Governor Clinton as supporting abortion on demand,
homosexuality and the distribution of condoms to teenagers in the
public schools. The letter cited various Biblical passages and
concluded with the statement: "How then can we vote for Bill
Clinton?" The letter concluded in fine print:
"Tax-deductible contributions for this advertisement gladly
accepted" and requested that donations be made to The Church
at Pierce Creek. IRS subsequently revoked the Church's 501(c)(3)
Tax exempt status retroactive to January 1, 1992.
(c) Mark & Tina Terry 1998. mtterry@goodnet.com
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