In order to maintain their non-profit status, the IRS has rules that say that such institutions have to refrain from outright partisan politics such as supporting political parties and candidates. Some churches have chafed under this restriction, think it an unconstitutional infringement on their free speech rights, and have sought to directly challenge that rule by organizing ‘Pulpit Freedom Sundays’ where they explicitly endorsed candidates and even sent the tapes to the IRS, daring them to come after them.
The IRS has avoided taking up the challenge so far and ignored what the churches have done but that do-nothing option may soon be precluded. The Freedom From Religion Foundation sued the IRS for its inaction, charging that it was not enforcing its rules equally and thus preferring church-based non-profits over others and in a settlement announced yesterday, the IRS agreed to monitor churches and other places of worship for electioneering.
The IRS has now resolved the signature authority issue necessary to initiate church examinations. The IRS also has adopted procedures for reviewing, evaluating and determining whether to initiate church investigations. While the IRS retains “prosecutorial” discretion with regard to any individual case, the IRS no longer has a blanket policy or practice of non-enforcement of political activity restrictions as to churches.
This settlement does not force the IRS to sue churches but it would be hard pressed to ignore cases of blatant electioneering, which is what the Pulpit Freedom Sunday churches are deliberately doing.
So expect to see a legal confrontation soon as to whether the IRS can make rules restricting the rights of speech in return for granting tax-exempt status.