IRS denies Christian nonprofit tax exemption, saying biblical values are Republican

By Casey Harper | The Center Square

A Christian group in Texas has released documents showing the IRS denied their organization’s application for tax exempt status in part because the IRS says “Bible teachings are typically affiliated with the [Republican] party and candidates.”

Christians Engaged, a faith-based group working to get Christians active in government, is challenging the IRS after the federal agency denied their application for 501(c)(3) nonprofit status.

“You instruct individuals on issues that are prominent in political campaigns and instruct them on what the Bible says about the issue and how they should vote,” the denial letter from IRS director of exempt organizations Stephen Martin, says. “These issues include the sanctity of life, the definition of marriage, and biblical justice. These issues generally distinguish candidates and are associated with political party platforms. These facts preclude you from exemption under IRC Section 501(c)(3).

“The bible teachings are typically affiliated with the [Republican] party and candidates. This disqualifies you…” the letter adds.

While this is only an individual case and not a broad IRS policy change, the codification of this interpretation could have implications for churches and other faith-based organizations. And many progressive churches and faith organizations operate on more liberal teachings that tend to lean more toward Democratic ideology.

Christians Engaged incorporated in 2019 as a nonprofit in Texas. The group said it has a mission that is not uncommon in the nonprofit sphere, to be a “nonpartisan religious and civic education, focusing on encouraging and educating Christians to be civically engaged as a part of their religious practice.”

“We just want to encourage more people to vote and participate in the political process,” Christians Engaged President Bunni Pounds said. “How can anyone be against that?”

The First Liberty Institute, a nonprofit Christian conservative legal organization based that is representing Christians Engaged, sent a letter to the IRS calling for a change in the decision.

“By finding that Christians Engaged does not meet the operational test, Director Martin errs in three ways: 1) he invents a nonexistent requirement that exempt organizations be neutral on public policy issues; 2) he incorrectly concludes that Christians Engaged primarily serves private, nonexempt purposes rather than public, exempt purposes because he thinks its beliefs overlap with the Republican Party’s policy positions,” the letter says. “And 3) he violates the First Amendment’s Free Speech and Free Exercise, and Establishment clauses by engaging in both viewpoint discrimination and religious discrimination.”

The decision is now being challenged with the Office of Independent Appeals, and First Liberty alleges the IRS has violated the organization’s First Amendment rights.

Whether they will prevail remains to be seen.

“The IRS states in an official letter that Biblical values are exclusively Republican,” said Lea Patterson, Counsel for First Liberty Institute, the group representing Christians Engaged. “That might be news to President Biden, who is often described as basing his political ideology on his religious beliefs. Only a politicized IRS could see Americans who pray for their nation, vote in every election and work to engage others in the political process as a threat. The IRS violated its own regulations in denying tax exempt status because Christians Engaged teaches biblical values.”