Charles M. Watkins, Esq.
Webster, Chamberlain & Bean
Churches, like other organizations that are exempt from
federal income tax under §501(c)(3), may not "participate in, or intervene in
(including the publishing or distributing of statements), any political campaign
on behalf of (or in opposition to) any candidate for public office."
Before 1954, the IRS and the courts generally
recognized that participation in a political campaign is not a charitable
activity, and an organization whose principal purpose was to do so could not be
exempt under §501(c)(3). However, an organization whose principal purpose was
religious or otherwise charitable could engage in incidental political activity
without jeopardizing its exemption.
In the course of the overhaul of the Internal Revenue
Code in 1954, then-Senate Minority Leader, Lyndon Johnson, persuaded his
colleagues to approve an amendment, adding the prohibition quoted above to
§501(c)(3). Although, for this reason, there is no legislative history, it has
been reliably reported that Senator Johnson was angry at members of the Bass
family who used several charities they controlled to oppose his election in
1948. The new prohibition would prevent a recurrence.
The prohibition against participating or intervening
in a political campaign applies only to elections for public office, and does
not apply to attempts to influence legislation. (Churches and other §501(c)(3)
exempt organizations may engage in such
attempts to influence legislation as an insubstantial part of
In addition, unlike the restriction on lobbying, the
prohibition on political activity is absolute. Exemption under §501(c)(3) may be
revoked for even the smallest amount of prohibited political activity. However
the IRS rarely revokes exemption for political activity, despite frequent
reports of church involvement in political campaigns by, e.g., allowing
candidates to speak from the pulpit, collecting campaign contributions during
worship services, and ferrying voters to the polls in church vans festooned with
signs promoting candidates of but one political party. Surprisingly, in the
mid-1990s, ministers from several churches in the Tidewater area around Norfolk,
Virginia complained publicly after being visited by IRS agents whose purpose was
merely to explain the rules prohibiting political activity, let alone open an
audit or revoke the churches’ exemptions.
The regulations under §501(c)(3) elaborate on the
prohibition only slightly, by defining the term "candidate for public office."
The term candidate for public office means an
individual who offers himself, or is proposed by others, as a contestant for an
elected public office, whether such office be national, State, or local.
Activities which constitute participation or intervention in a political
campaign on behalf of or in opposition to a candidate include, but are not
limited to, the publication or distribution of written or printed statements or
the making of oral statements on behalf of or in opposition to such a candidate.
Suffice it to say that the statute and regulations
provide little practical guidance to the pastor or other church leader who is
diligently attempting to ascertain which activities are permitted, and which are
not. Although the IRS and the courts have issued a number of rulings and
judicial opinions addressing these issues, to which we turn in a moment, except
for three activities that are prohibited per se, the question turns on a
review of all of the facts and circumstances, and slight variations in the fact
patterns might easily produce a different result.
II. PER SE PROHIBITED ACTIVITIES
Three types of activities are prohibited per
se: Candidate endorsements (or denouncements), candidate ratings, and
contributions of cash, goods, or services to a campaign.
A. Candidate endorsements and denouncements
A church may not, as a matter of its official
position, endorse or oppose a candidate for public office. Thus, a pastor
speaking from the pulpit or otherwise in his capacity as the pastor, may not
urge his audience to vote for or against a particular candidate. Likewise, a
church may not publish an article in its newsletter, or place an advertisement
exhorting readers to vote for or against a particular candidate. This is
well-illustrated by the recent case of Branch Ministries v. Rossotti,
involving the denouncement of Bill Clinton by a church. In 1992, only days
before the election, The Church at Pierce Creek in Binghamton, New York, placed
a full-page advertisement in USA Today and the Washington Times.
The advertisement highlighted then-Gov. Bill Clinton’s support for abortion on
demand, civil rights for homosexuals, and the distribution of condoms to high
school students, and then asked "How then can we [Christians] vote for Bill
Clinton?" (The Church’s advertisement did not tell Christians whether to vote
for then-President Bush, running for re-election, or for Ross Perot, running as
the candidate of the Reform Party.) Ironically, the advertisement also stated,
"Tax-deductible contributions for this advertisement gladly accepted."
Despite its general reticence to act against churches on
account of their political activities, the IRS did not shrink from this "in your
face" challenge and, in 1995, revoked the Church’s exemption. The Church
litigated the issue and the trial court summarily upheld the IRS’ revocation. On
appeal, the Court of Appeals gave equally short shrift to the Church’s
The Church first argued that the Internal Revenue Service did
not have statutory authority to revoke a church’s tax-exempt status, because the
Church’s exemption is derived not from §501(c)(3), but from the lack of any
provisions in the Internal Revenue Code for the taxation of churches. The Court
of Appeals concluded that the Church Audit Protection Act, expressly authorizes
the IRS to revoke the tax-exempt status of a church in certain circumstances,
including when a church is not exempt by reason of its failure to satisfy
The Church also challenged the IRS’ authority, based the
Free Exercise Clause of the First Amendment and the Religious Freedom
Restoration Act. The court found that under either rule the Church must first
establish that its Free Exercise rights had been substantially burdened. The
court denied the Church’s predicate that "withdrawal of a conditional privilege
for failure to meet the condition is in itself an unconstitutional burden on its
Free Exercise Right." The Church’s assumption is true only when "the receipt of
the privilege (in this case the tax-exemption) is conditioned upon conduct
prescribed by a religious faith, or…denied…because of conduct mandated by
religious belief, thereby putting substantial pressure on an adherent to modify
his behavior and to violate his beliefs." Because the Church did not also argue
that withdrawing from electoral politics would violate its beliefs, and the sole
effect of the loss of exemption might be some decrease in the amount of money
available to the Church for its religious practices, that burden was not
constitutionally significant. In fact, the court suggested that even that burden
was overstated, because no tax is assessed on gifts, and if the Church does not
intervene in future political campaigns, it may hold itself out as a §501(c)(3)
organization without re-applying for exemption.
Finally, the court noted that the Church had alternate
means by which to communicate its sentiments about candidates for public office.
Following the Supreme Court’s decision in Regan v. Taxation With
Representation, the court observed that the Church could form a related
§501(c)(4) organization, which could then sponsor a political action committee
in order to participate in political campaigns.
Because the church had failed to show that its religious
activities were substantially burdened by revocation of its tax-exempt status,
the court did not consider whether the prohibition serves a compelling
government interest, or, if so, whether revocation of exemption was the least
restrictive means of furthering that interest.
In an earlier case, Christian Echoes National
Ministry, Inc. v. United States the court agreed with the IRS that a
religious corporation whose publications attached candidates and incumbents
considered to be too liberal, and urged its followers to elect conservatives,
including Strom Thurmond and Barry Goldwater, violated the prohibition on
participation in political campaigns. The court in Christian Echoes
overruled the trial court’s Free Exercise analysis (prohibiting the IRS from
evaluating the organization’s activities as "religious" or "political" for
purposes of denying tax-exempt status), and concluded that revocation of
exemption was the least restrictive means of upholding the Government’s
"overwhelming and compelling…interest: That of guarantying [sic] that the wall
separating church and state remain [sic] high and firm."
B. Candidate ratings
Another form of endorsement is the rating of
candidates, usually based on the extent to which the candidates’ views or
qualifications align with those of the organization on those issues that the
organization views as important. These, too, are prohibited per se,
because they both endorse those candidates who are rated favorably, and
implicitly oppose those candidates who are rated unfavorably.
In Association of the Bar of the City of New York v.
Commissioner, the issue of whether the Association’s activities in rating
candidates for appointed and elected judgeships at the municipal, state, and
federal level disqualified it from exemption under §501(c)(3). The Association’s
Committee on the Judiciary
considers a candidate’s professional ability, experience,
character, temperament, and the possession of such special qualifications as the
Committee deems desirable for judicial office. It then rates the candidate as
either "approved", or "not approved" or "approved as highly qualified." The
ratings are communicated to the public in the form of press releases and are
published in The Record of the Association of Bar of the City of New York,
a regular publication of the Association which is sent out to the Association
members and approximately 120 other subscribers, including libraries and law
schools. A "not approved" rating may be accompanied on occasion by a short
statement explaining the reasons for the rating.
The Association, which had been exempt under §501(c)(6),
applied for exemption under §501(c)(3), and the IRS denied the application on
the basis that the Association’s ratings of judicial candidates constituted
impermissible participation in or intervention in a political campaign. Although
the Tax Court held that the Association’s ratings were not prohibited political
activities, the Court of Appeals reversed, citing the Tax Court’s conclusion
that it is "obvious that the ratings were published with the hope that they will
have an impact on the voters." That the Association’s ratings were published
without reference to any party affiliation did not avail the Association,
because an individual may campaign for public office as an independent
candidate, apart from any political party nomination or endorsement. The court
also countered the Association’s assertion that its rating activity involved
merely the collection and limited dissemination of objective data, by pointing
out that the Tax Court concluded "‘that ratings, by their very nature,
necessarily will reflect the philosophy of the organization conducting such
activities,’ and they are simply expressions of ‘professional opinion’
concerning the candidate’s qualifications."
More recently, the Assistant Chief Counsel (Employee Benefits
and Exempt Organizations) concluded that a church may have engaged in prohibited
political activities in connection with an insert in the church bulletin
"recommending" certain candidates. The facts indicate that the church bulletin
was routinely provided to those attending church services. On one particular
Sunday, the bulletin included a one-page document insert indicating that certain
candidates were "recommended" for office. The Office of the Chief Counsel
concluded that revocation of exemption may be appropriate unless the church
"provides evidence sufficient to show that the distribution of the insert was
inadvertent, unauthorized, or otherwise not attributable to the church."
C. Campaign contributions
Finally, although it may seem to be so obvious as
to be unnecessary to address, churches and other charities may not contribute
cash, goods, or services in support of a candidate for public office. Thus, for
example, a church may not contribute money, nor permit a campaign committee to
use its office equipment or supplies without charging an amount at least equal
to the value provided. Likewise, the church may not permit its employees to
provide services to a campaign during their work time, or to use church
resources in the course of their work for the campaign. Of course, this would
not preclude an employee from working for a campaign after hours, on weekends,
or while taking normal vacation or other leave from his duties for the church.
III. OTHER ACTIVITIES
Aside from the three activities described above,
whether an organization has engaged in prohibited participation of a political
campaign depends on all of the facts and circumstances focusing specifically on
whether an activity, or some significant aspect of it, is "biased" in favor of
or against one or more candidates.
In addition, the IRS has declared that it will not follow the
"express advocacy" rule established by the Supreme Court in interpreting the
Federal Election Campaign Act.
M has argued that there must be more than evidence of bias in
this fundraising letter for or against candidates running for public office in
order for M to be found to have violated the section 501(c)(3) political
intervention prohibition. However, in respect to this prohibition there is no
"express advocacy" rule as was required by the Supreme Court in Buckley v.
Valeo, 424 U.S. 1 (1976) and Federal Election Commission v. Massachusetts
Citizens for Life, 479 U.S. 238 (1986), in regard to influencing federal
elections under the jurisdiction of the Federal Election Commission. For
purposes of section 501(c)(3), intervention in a political campaign may be
subtle or blatant. It may seem to be justified by the press of events. It may
even be inadvertent. The law prohibits all forms of participation or
intervention in "any" political campaign.
A. Voter guides
The most contentious area that arises when a
church seeks to involve itself in the political process without violating the
Internal Revenue Code is the extent to which voter guides may be considered to
evidence bias in favor of or against a candidate.
- Rev. Rul. 78-248.
The principal IRS ruling addressing this issue is Rev. Rul.
78-248. In that ruling, the IRS considered four situations.
Organization A has been recognized as exempt under
section 501(c)(3) of the Code by the Internal Revenue Service. As one of its
activities, the organization annually prepares and makes generally available to
the public a compilation of voting records of all Members of Congress on major
legislative issues involving a wide range of subjects. The publication contains
no editorial opinion, and its contents and structure do not imply approval or
disapproval of any Members or their voting records.
The "voter education" activity of Organization A is not
prohibited political activity within the meaning of section 501(c)(3) of the
The IRS conclusion in Situation 1 is not controversial,
but it addresses a relatively uncommon fact pattern. First, the publication is
not, technically speaking, a "voter guide." Instead, it reports on the voting
records only of incumbents. Second, few organizations have the resources to
prepare and publish a compilation of the voting records of all incumbents on a
significant number and wide range of legislative issues. An finally, in the
context of an election campaign, some incumbents are not running for
re-election, and this type of "voter guide" would provide little useful
information with respect to those races.
Organization B has been recognized as exempt under
section 501(c)(3) of the Code by the Internal Revenue Service. As one of its
activities in election years, it sends a questionnaire to all candidates for
governor in State M. The questionnaire solicits a brief statement of each
candidate's position on a wide variety of issues. All responses are published in
a voters guide that it makes generally available to the public. The issues
covered are selected by the organization solely on the basis of their importance
and interest to the electorate as a whole. Neither the questionnaire nor the
voters guide, in content or structure, evidences a bias or preference with
respect to the views of any candidate or group of candidates.
The "voter education" activity of Organization B is not
prohibited political activity within the meaning of section 501(c)(3) of the
Situation 2 is also relatively noncontroversial, but,
again, it does not frequently occur in campaigns. In addition, the IRS generally
takes the position that an organization may not report that a campaign failed to
respond to its questionnaire. Unfortunately, the IRS has refused to explain why
such a truthful response cannot be published or why the publication of that
information is evidence of bias against a candidate who has chosen, usually
after repeated attempts to contact the campaign, not to respond to the
Organization C has been recognized as exempt under
section 501(c)(3) of the Code by the Internal Revenue Service. Organization C
undertakes a "voter education" activity patterned after that of Organization B
in Situation 2. It sends a questionnaire to candidates for major public offices
and uses the responses to prepare a voters guide which is distributed during an
election campaign. Some questions evidence a bias on certain issues. By using a
questionnaire structured in this way, Organization C is participating in a
political campaign in contravention of the provisions of section 501(c)(3) and
is disqualified as exempt under that section.
Situation 3 is controversial, precisely because the IRS
fails to address the question regarding how the questions evidence bias on
certain issues. Of course, Situation 3 also shares the weakness of Situation 2
in that the IRS takes the position that an organization publishing a voter guide
is not permitted to report that a candidate failed to respond to its
Organization D has been recognized as exempt under
section 501(c)(3) of the Code. It is primarily concerned with land conservation
The organization publishes a voters guide for its members
and others concerned with land conservation issues. The guide is intended as a
compilation of incumbents' voting records on selected land conservation issues
of importance to the organization and is factual in nature. It contains no
express statements in support of or in opposition to any candidate. The guide is
widely distributed among the electorate during an election campaign. While the
guide may provide the voting public with useful information, its emphasis on one
area of concern indicates that its purpose is not nonpartisan voter education.
By concentrating on a narrow range of issues in the voters
guide and widely distributing it among the electorate during an election
campaign, Organization D is participating in a political campaign in
contravention of the provisions of section 501(c)(3) and is disqualified as
exempt under that section.
Situation 4, which arguably presents the most common fact
pattern, is also quite controversial, because it prohibits an exempt §501(c)(3)
organization that is concerned with a single issue or a set of related issues
from educating the public about the candidates’ positions with respect to that
limited set of issues. That this conclusion is probably wrong is also indicated
by the fact that a "widely distributed" voter guide is virtually certain to be
distributed to a large number of people who may be opposed to the positions of
the organization on those issues, and who will thereby be motivated to vote for
a candidate who may in fact be opposed by the organization. In view of the
Supreme Court’s "express advocacy" standard under the Federal Election Campaign
Act, an organization wishing to challenge this standard should prevail.
Unfortunately, no one has litigated the issue to date, and the expense of doing
so is likely to dissuade many who would otherwise take up the challenge.
- Rev. Rul. 80-282.
Two years later, the IRS amplified Rev. Rul. 78-248 by
publishing Rev. Rul. 80-282, Rev. Rul. 80-282 considers the publication of
summary of the voting records of all incumbent members of Congress on selected
legislative issues important to the organization publishing the summary,
together with an expression of the organization’s position on those issues. Each
member’s votes were to be recorded in a way which illustrates whether he or she
voted in accordance with the organization’s position on the issue.
Technically, this publication was not a voter guide at all,
but simply a report of the legislative activity of incumbent members of
Congress. The reason is that
[t]he newsletter is to be politically non-partisan, and will
not contain any reference to or mention of any political campaigns, elections,
candidates, or any statements expressly or impliedly endorsing or rejecting any
incumbent as a candidate for public office. No mention will be made of an
individual’s overall qualifications for public office, nor will there be any
comparison of candidates that might be competing with the incumbent in any
political campaign. The voting records of all incumbents will be presented and
candidates for re-election will not be identified. The newsletter will point out
the limitations of judging the qualifications of an incumbent on the basis of a
few selective votes and will note the need to consider such unrecorded matters
as performance on subcommittees and constituent service.
The ruling also noted that "publication usually will
occur after congressional adjournment and will not be geared to the timing of
any federal election. The newsletter will be distributed to the usual
subscribers, and will not be targeted towards particular areas in which
elections are occurring."
After reviewing Situations 3 and 4 of Rev.
Rul. 78-248, the IRS concluded that although the format and content of the
publications are not neutral, because the organization did not refer to election
matters; pointed out that other factors should be considered in determining the
qualifications of an incumbent; and distributed the publication only to the
normal readership of the newsletter, a few thousand people nationwide, the
publication did not constitute participation or intervention in a political
2. Candidate forums and debates
Another way in which churches may influence
public opinion during election campaigns is to sponsor candidate forums and
debates where candidates can address issues of interests to the electorate. By
having candidates present in the same event, those attending are better able to
compare and contrast the candidates’ views.
The IRS issued guidelines regarding the conduct of such
forums and debates in Rev. Rul. 86-95. In Rev. Rul. 86-95, the IRS concluded
that the conduct of candidate forums that provide fair and impartial treatment
of candidates, and that do not promote or advance one candidate over another
does not constitute participation or intervention in a political campaign on
behalf of or in opposition to any candidate for public office. The facts
indicate that the §501(c)(3) sponsor would invite all legally qualified
candidates for the office in question to participate. The agenda would cover a
broad range of issues, including, but not limited to those issues considered to
be important to the sponsors and sponsor’s members; questions to the candidate
would be presented by a nonpartisan, independent panel of knowledgeable persons
composed of representatives of the medial, educational organizations, community
leaders, and other interested persons; each candidate would be allowed an equal
opportunity to vent his or her views on each of the issues discussed, the
moderator would ensure that the ground rules as followed by all participant; and
at the beginning and end of each forum, the moderator would state that the views
expressed are those of the candidates and not those of the organization, and
that the organization’s sponsorship of the forum is not intended as an
endorsement of any candidate.
The IRS has also concluded that in some cases, it is not
necessary for an organization to invite all legally qualified candidates
to participate in candidate forums and debates.
In circumstances where the number of legally qualified
candidates for a particular office is large, a sponsoring organization exempt
under section 501(c)(3) of the Code might determine that holding a debate to
which all legally qualified candidates were invited would be impracticable and
deter [sic] from the educational purposes of the organization. In determining
whether a section 501(c)(3) organization participates or intervenes in a
political campaign when it holds a candidate debate to which not all legally
qualified candidates are invited, all the facts and circumstances must be
considered including the following:
- Whether inviting all legally qualified candidates is
- Whether the organization adopted reasonable, objective
criteria for determining which candidates to invite;
- Whether the criteria were applied consistently and
non-arbitrarily to all candidates; and
- Whether other factors, such as those discussed in Rev.
Rul. [86-95], … indicate that the debate was conducted in a neutral,
M’s, decision to invite only the candidates from O and P
parties and up to four candidates who agreed to a 15 percent share of popular
support as reflected in at least one recognized credible and independent
State-wide poll would appear to accentuate the educational nature of the forums
and still ensure a meaningful field of candidates for worthwhile forums, while
allocating for the organization’s limited space and time.
3. Candidate appearances and speeches
Appearances by individual candidates at churches
– apart from a multi-candidate forum or debate—can pose thorny issues for the
church. Again, the "neutrality" principle must be used to determine whether the
activity is prohibited.
- Do all candidates have an equal opportunity to speak in
the same kind of event?
- If the candidate’s presence is merely acknowledged, is
equal treatment accorded to all candidates who may be present at other times?
- If the candidate is permitted to speak or is acknowledged
because she is an incumbent, is there any mention of the individual’s candidacy,
the election, or voting?
- Do any campaign activities—e.g., distributing
promotional literature, buttons, bumper stickers, or collecting campaign
contributions—occur on the church’s premises in connection with the candidate’s
attendance or speech?
4. Voter registration drives and "get-out-the-vote"
Subject to the prohibition on intervention in a
political campaign, the Internal Revenue Code does provide some leeway for
churches and other charities to engage in voter registration and
get-out-the-vote activities. As an exception to rules prohibiting certain
"taxable expenditures" by private foundations, §4945(d)(2) permits private
foundations to spend themselves, or to make grants to any public charity
(including a church or association of churches):
(1) which is described in section 501(c)(3) and exempt from
taxation under section 501(a),
(2) the activities of which are nonpartisan, are not confined
to one specific election period, and are carried on in 5 or more States,
(3) substantially all of the income of which is expended
directly for the active conduct of the activities constituting the purpose or
function for which it is organized and operated,
(4) [based on 5-year "rolling" averages,] substantially all
of the support (other than gross investment income as defined in section 509(e))
of which is received from exempt organizations, the general public, governmental
units described in section 170(c)(1), or any combination of the foregoing; not
more than 25 percent of such support is received from any one exempt
organization (for this purpose treating private foundations which are [related]
to each other as one exempt organization); and not more than half of the support
of which is received from gross investment income, and
(5) contributions to which for voter registration drives are
not subject to conditions that they may be used only in specified States,
possessions of the United States, or political subdivisions or other areas of
any of the foregoing, or the District of Columbia, or that they may be used in
only one specific election period.
In any event, like most other activities, voter registration
drives must be conducted in a nonpartisan manner, without bias towards or
against any candidate. The IRS has identified four factors that it would
consider in making this determination:
- Whether no candidate is named or depicted, or all
candidates for a particular Federal office are named or depicted without
favoring any candidate over any other in the voter registration or
get-out-the-vote drive communication;
- Whether the communication names no political party except
that [sic] for identifying the political party affiliation of all candidates
named or depicted;
- Whether the communication is limited to urging acts such
as voting and registering and to describing the hours and places of registration
and voting; [and]
- Whether all voter registration and get-out-the-vote drive
services are made available without regard to the voter’s political preference.
The IRS also indicates that other facts and circumstances
may be considered.
A church may use voter registration lists to identify
unregistered voters, provided that it does not target voter registration efforts
to those who are registered with a particular party.
5. Internet-related activities
The "neutrality" principle also applies to a
church’s communications on its website. For example, if the church includes
statements by candidates regarding their position on abortion, it should include
statements, insofar that they are available, from all candidates for the office
in question. Likewise, if a church provides a link to a candidate’s website, a
link should also be provided to the website of all other candidates for the
- Business activities
As noted above, the church may not contribute money,
or goods or services, such as the use of its mailing list, to a candidate.
However, a church may sell or rent goods, or sell services, or the use of
facilities, to candidates, provided it deals with all candidates on the same
terms and, preferably, on the same terms that it deals with other non-political
- Services or facilities offered to one candidate must be
offered to all.
- Services provided to one candidate (upon request by the
candidate) must be available to all (upon request). (IRS says notice of
availability must be given to all.)
- Advertising may be sold on the same terms made available
to other non-church advertisers.
- The mailing list may be rented on the same terms made
available to other non-church users.
- Is the product or service made available only to
candidates? Has it previously been made available to candidates?
IV. WHO IS THE ACTOR? PERSONAL vs. ORGANIZATIONAL ACTIVITIES
The IRS has addressed when the acts of a church
official or member might be attributed to the church because the individual was
acting as an agent of the church:
A section 501(c)(3) organization acts or communicates with
others through the authorized actions of its employees or members. There must be
real or apparent authority by the organization of the actions of individuals
other than officials [whose authority is presumed] before the actions of those
individuals will be attributed to the organization. In general, the principles
of agency will be applied to determine whether an individual engaging in
political activity was acting with the authorization of the section 501(c)(3)
organization. Actions of employees within the context of their employment are
considered to be authorized by the organization.
Acts of individuals that are not authorized by the section
501(c)(3) organization may be attributed to the organization if it explicitly or
implicitly ratifies the actions. A failure to disavow the actions of the
individual under apparent authorization from the section 501(c)(3) organization
may be considered a ratification of the action. To be effective, the disavowal
must be made in a timely manner equal to the original action. The organization
must also take steps to ensure that such unauthorized actions do not recur.
The IRS also noted that
revocation of exempt status is not automatically required,
even if it is determines that the distribution of the bulletin insert
constitutes a violation of the political intervention restriction attributable
to the church. Although revocation is available, the Service may
administratively determine that under the facts and circumstances revocation is
not warranted. The Service could conclude that, rather than revocation, either
assessment of section 4955 tax alone or some type of closing agreement setting
forth standards the [organization] must follow or acts it must undertake in
order to retain its exempt status, would be appropriate.
The prohibition on political activities by
churches and other exempt organizations does not extend to the activities of
individuals who are officials or volunteer leaders of the church. Individuals do
not check their First Amendment and other personal rights at the door when they
step into a leadership position in the church. Accordingly, pastors and other
church leaders may fully exercise their individual rights to participate in the
political process without jeopardizing the church’s income tax exemption.
However, it is important to ensure that the individual is not acting as an agent
of the church, and is not using the church’s resources while engaging in
protected individual political activity.
For example, suppose a candidate publishes a full-page ad in
the local newspaper listing prominent ministers, including Father Ryan, who has
personally endorsed the candidate. Father Ryan is identified in the ad as the
pastor of St. Patrick’s Church. The ad states: "Titles and affiliations are
provided for identification purposes only." Because the ad was not paid for by
the church, the ad is not otherwise in an official publication of the church,
and the endorsement is made by Father Ryan in his personal capacity, the ad does
not constitute campaign intervention by St. Patrick’s church.
In contrast, if Father Ryan had endorsed the candidate in the
church’s newsletter or from the pulpit during the church’s worship service,
those activities, because they were conducted in the context of Father Ryan’s
duties as pastor of the church, would be treated as prohibited political
activity by the church.
Likewise, a pastor or other church leader may contribute
to a political candidate’s campaign committee from his personal funds, may
attend party conventions and other political meetings at his personal expense
and on his own time, and may otherwise engage in volunteer activities in support
of a candidate’s campaign, provided that church resources, such as its mailing
list, facilities, and equipment, are not used in those efforts.
A church may be very active in informing and
influencing its parishioners and the community about elections, candidates, and
the electoral process. Aside from the prohibitions on contributions to
candidates, and candidate endorsements and ratings, the church’s involvement
must be carefully neutral and unbiased in order to avoid jeopardizing its
exemption under §501(c)(3). Unfortunately, the IRS has given no guidance on how
to avoid bias in voter guides, which are the most common area in which
A church may also encourage its members to be active in
political campaigns, provided it does not recommend any particular candidate or
party. Finally, the pastor or other employees and volunteer leaders of a church
have the right to participate in political activities, provided they do not use
the church’s resources, and they are not acting as the church’s agents, when
they do so.