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Church And Non-Profit Political Activity – An Update



An unusual alliance of religious and secular groups has recently called for the IRS to clarify its rules regarding non-profit organizations and their political activity. Leaders from the Evangelical Council for Financial Accountability (ECFA), Alliance Defending Freedom (ADF), the Public Citizen, and the Center for American Progress (CAP) met in Washington to discuss what the IRS could do to lend some clarity to this issue. ECFA seeks to make Christian non-profit organizations accountable through adherence to its Seven Standards of Responsible Stewardship; ADF has long advocated more freedom for ministers in addressing political issues from the pulpit. The Public Citizen is a non-profit, consumer rights advocacy group and think tank while the Center for American Progress is a progressive public policy research and advocacy organization. According to CAP, the center is “dedicated to improving the lives of Americans through progressive ideas and action.

Michael Batts, who chaired the ECFA’s Commission on Accountability and Policy for Religious Organizations stated that the IRS should hesitate to enforce some of its current rules which could cause constitutional and public relations problems. “The IRS needs an exit strategy, and churches and charities need freedom of speech and the freedom to exercise religion,” Batts stated. Erik Stanley of ADF, stated flatly that the IRS rules about “indirect” campaigning are too vague and the IRS is not enforcing its rules about direct campaigning. He called for legislative fixes for the IRS policy.

Although the spokespersons for these groups, as well as others, were not united in their feelings toward church and charity campaign activity, all agreed that the current IRS policy is unworkable and that the rules should change. Some would give complete freedom in this area for such organizations, while others would only seek that the rules be kept in place, merely clarified. Still others feel that churches and charities should have the right to make political statements, but should exercise a great deal of discretion, especially when it comes to endorsing candidates for office.

The present rules arose in 1954 when the Johnson Amendment was adopted without committee hearings nor discussion when introduced on the floor of the senate by then Senator Lyndon Johnson. The IRS did not immediately respond to a request for comment on the positions expressed.

See Part 1, Part 2 and Part 3

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Dr. John Stancil (My Bald CPA) is Professor Emeritus of Accounting and Tax at Florida Southern College in Lakeland, FL. He is a CPA, CMA, and CFM and passed all exams on the first attempt. He holds a DBA from the University of Memphis and the MBA from the University of Georgia. He has maintained a CPA practice since 1979 with an emphasis in taxation. His areas of expertise include church and clergy tax issues and the foreign earned income credit. He prepares all types of returns, individual and business.

Dr. Stancil has written for the Polk County Business Journal and has presented a number of papers at academic conferences. He wrote the Instructor’s Manual for the 13th edition of Horngren’s Cost Accounting. He is published in the Global Sustainability as a Business Imperative, Green Issues and Debates, The Encyclopedia of Business in Today’s World, The Palmetto Business Review, The CPA Journal, and in the NATP TaxPro Journal. His paper, “Building Sustainability into the Tax Code” was recognized as the outstanding accounting paper at the annual meeting of the South East InfORMS. He wrote a book entitled “Tax Issues Faced by U. S. Missionary Personnel Abroad ” that will soon be published.

He has recently launched a new endeavor, Church Tax Solutions, which presents online, on demand seminars on various church and clergy tax issues.

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