Released: October 19, 2006

IRS cracks down on church politicking

Source: By Michael Levenson and Scott Helman, Boston Globe (Free Registration)

Alarmed by an increase in political activity by religious organizations, the IRS pledged earlier this year to crack down on violators. The agency issued a memo in February warning that churches and other tax-exempt organizations “are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office.”

The agency says such organizations risk losing tax-exempt status if they endorse candidates, distribute statements for or against candidates, raise funds for or donate to candidates, or become involved in any activity that would either be supportive or opposed to a candidate. They are also prohibited from allowing a candidate to use their assets or facilities, if other candidates are not given the same opportunity.

The IRS said it discovered a surprising level of political activity among churches and other tax-exempt organizations in the 2004 elections. Out of 82 investigations of tax-exempt organizations completed by February, the IRS found political violations in 59 cases. In 56 cases, the organizations were issued warning letters or ordered to pay taxes. In three cases, they were stripped of their tax-exempt status. In 18 cases, no violation was found, and in five cases, violations not related to politics were discovered, the agency said.

“While the vast majority of charities and churches do not engage in politicking, an increasing number did take part in prohibited activities in the 2004 election cycle,” IRS Commissioner Mark W. Everson said in a June statement. “The rule against political campaign intervention by charities and churches is long established. We are stepping up our efforts to enforce it.”

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