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Congressional Caution Is Needed

Friday, February 10, 2017   (0 Comments)
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Congressional Caution Is Needed


Decisions about the Johnson Amendment and the tax code shouldn't be taken lightly.


By Alan Brownstein | Contributor Feb. 10, 2017, at 12:00 p.m.

Congress should think long and hard before it agrees to President's Trumps demand to "destroy" and repeal the Johnson Amendment. Repealing the tax code provision prohibiting tax exempt 501(c)(3) nonprofit organizations from engaging in political campaigns for electoral candidates raises numerous hard questions. Congressional caution is necessary here.

What would be the scope of this repeal? While most criticisms of the amendment focus on perceived constraints on the political activity of churches, its repeal would have to apply to all 501(c)(3) organizations, including scientific, literary, educational and charitable organizations. Any attempt to repeal the amendment just for religious organizations, while continuing to prohibit political campaigning by secular organizations, would raise serious constitutional questions under both the free speech clause and the establishment clause of the First Amendment.

What limits on the electioneering activities of 501(c)(3) organizations would apply if the amendment is repealed? That's hard to say. In a way this is like demands for the repeal of the Affordable Care Act. A lot depends on what it is replaced with. Some critics of the Johnson Amendment seem to reject any IRS constraints on the political activity of churches. That would require more than the repeal of the amendment. Alternatively, Congress could permit political campaign activity as long as it was an insubstantial part of the church's or charity's activities. That would track some current language in the tax code after deleting the amendment. It would also track current uncertainty as to what this language means. Yet another approach would amend the code to permit only very limited and incidental election campaigning – so that clergy would not worry about endorsing a candidate in a sermon. But that's far less than destroying and repealing the amendment.

What would happen if the amendment is repealed in its entirety?

Would this free religious organizations from being monitored by the IRS to determine if they engaged in too much political activity? That's doubtful. Limiting tax-exempt organizations to insubstantial political activity would still have to be enforced. Increased participation by churches in political campaigns might actually result in greater entanglement of the state in church institutional affairs to measure and value the church's activities against tax code requirements.

Would the repeal make a difference in election campaigns? Americans report billions of dollars in charitable deductions. Even if 501(c)(3) organizations only used an insubstantial amount of their resources for election campaigning, that's a great deal of money. In 2008, religious organizations played a very significant role in passing the Proposition 8 initiative in California. Without the Johnson Amendment, similar resources and organizational efforts could be used to support electoral candidates.

Could donors to PACs or political campaigns redirect contributions to 501(c)(3) organizations and transform their after-tax political contributions into tax deductible donations? It's certainly possible. For example, donors could request that their contributions be used by a church public advocacy ministry heavily involved in an election campaign. And religious organizations could grant their request although they would not be legally obligated to do so.

Would repealing the amendment be good or bad for charities and religious organizations? There are obvious problems with the repeal. A prohibition against political campaigning protects charities and churches from being pressured by candidates for endorsements and support. Such "requests" for support are particularly problematic because both secular charities and religious organizations often receive direct and indirect government grants and aid.

Further, the involvement of churches in political campaigns will divide and distract religious congregations. Those of us who have had the privilege (and shouldered the burden) of serving on boards or in lay leadership positions of churches and synagogues know that internal congregational politics are difficult enough without injecting partisan politics into our deliberations.

Keeping partisan politics out of houses of worship and charities is important for another reason. Some Americans believe politics permeates everything. It defines our institutions and who we are as individuals. But there is another vision of America that puts politics in its place. Americans are more than political antagonists. We can see each other as people and families with far more in common with each other than the political disagreements that divide us. To do that, we need to have neutral spaces where we can leave partisan divisions behind us. Charities should be places where our common humanity and the American virtues we share of generosity and service come to the fore. Houses of worship should be places where we are neither Democrats nor Republicans, but rather people joined in humanity and humility in spiritual fellowship and worship.

Tags: Donald TrumpCongresstax codepoliticscampaignscampaign financereligion,philanthropynonprofits

Alan Brownstein is a professor of law emeritus at the University of California, Davis School of Law.


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