The Republican Party has made a restriction preventing 501(c)(3) organizations from engaging in partisan political activity a focus of the 2016 election. The so-called “Johnson Amendment” — named after then-Sen. Lyndon B. Johnson — affects all 501(c)(3) nonprofits, but interests have centered around the impact on religious organizations.
“We value the right of America’s religious leaders to preach, and Americans to speak freely, according to their faith,” the GOP platform reads. “Republicans believe the federal government, specifically the IRS, is constitutionally prohibited from policing or censoring speech based on religious convictions or beliefs, and therefore we urge the repeal of the Johnson Amendment.”
Republican presidential nominee Donald Trump referenced the amendment in his acceptance speech at the Republican National Convention in Cleveland, Ohio. “Their voice has been taken away,” he said when referencing to the evangelical community.
Requests for comment made to a GOP spokesperson were not returned.
Many of the leaders of the 2,200 organizations that make up the Association of Christian Nonprofits are unaware that the prohibition is called the Johnson Amendment, according to Doug Leslie, president and CEO. They are, however, seeking clarification regarding what is permissible and what is not.
“For the most part, they don’t have any desire to be political,” Leslie said of members. “But they don’t feel free to speak to the cultural and moral issues that speak to their constituency.”
A lack of clarity regarding which types of speech can trigger loss of exemption and what is permissible can lead to self-censorship, he said. Abortion, for instance, is an issue of consequence to religious organizations that leaders might shy away from discussing given the politics surrounding it.
Pastoral members of the Goodyear, Ariz.-based association tend to have more interest in speaking to potentially political issues than religiously affiliated service providers. No members have voiced a desire to repeal the amendment, Leslie said, but refined language and clearer demarcation of what is acceptable and what is not would assuage present concerns.
A complete repeal or refinement would serve the same purpose, he said, allowing leaders of religious groups a defined sense of what they are free to discuss and what they are not.
Erik W. Stanley, senior council and director of the Center for Christian Ministries at the Alliance Defending Freedom (ADF), argues that the Johnson Amendment is unconstitutional. The Internal Revenue Service (IRS), by dictating what pastors can and cannot say or distribute, violates religious leaders’ freedom of speech and to exercise their faith, he said.
ADF, headquartered in Scottsdale, Ariz., began looking into the Johnson Amendment in 2007, according to Stanley, and garnered its greatest amount of exposure in 2008 when 33 pastors preached political sermons, recorded them and sent them to the IRS. More than 2,000 pastors have willfully violated the amendment in protest as part of “Pulpit Freedom Sunday” since 2008. None have received disciplinary action.
This year has been the year of greatest political interest in the amendment, according to Stanley. After six decades, religious leaders are still unclear on what is permissible, resulting in self-censorship. A change in the rules, not a full repeal, is what is being advocated for among religious leaders.
One proposed change would allow organizations’ freedom to political speech so long as it does not cost additional money. For instance, a sermon would be acceptable, but not a newspaper advertisement. “The IRS should not be the speech police,” Stanley said. “This is a grant of power that the IRS should not have, to go after people by what they say.”
Religious organizations have additional rights to changes under the amendment as compared to other 501(c)(3) organizations, Stanley said, as both their right to free speech and religious expression are being infringed on.
The IRS tax guide for churches and religious organizations states “…501(c)(3) organizations must avoid any issue advocacy that functions as political campaign intervention. Even if a statement does not expressly tell an audience to vote for or against a specific candidate, an organization delivering the statement is at risk of violating the political campaign intervention prohibition if there is any message favoring or opposing a candidate.”
An IRS spokesperson declined to discuss tax policy. An organization that has its exemption revoked is free to reapply, he said.
Marc Owens, now a partner at Loeb & Loeb in Washington, D.C., spent a decade leading the Exempt Organizations Division within the IRS. Compliance with the Johnson Amendment has a history of being investigated and enforced across different types of organizations, he said.
The Association of the Bar of the City of New York attempted during the 1980s to file as an educational charity and was denied, according to Owens. The decision, which was upheld by the United States Court of Appeals for the Second Circuit, was rendered because the association periodically rated judicial candidates, even though the ratings and elections were nonpartisan.
The IRS opened an audit on the National Association for the Advancement of Colored People (NAACP) in 2004 in response to comments then-chair Julian Bond made during a speech. The organization’s exempt status did not change, Owens said.
Examples of religious organizations penalized include Pat Robertson’s Christian Coalition of America, which was denied exempt status by the IRS, and Old Time Gospel Hour, started by the Rev. Jerry Falwell and continued by his son under the name Thomas Road Live, which was ordered to pay $50,000 in taxes, according to news reports.
What is often overlooked, according to Owens, is that partisan political activity falls outside of charitable missions. The Johnson Amendment didn’t change that, he said. It just drew a line in the sand stating that no amount of such activity would be permissible while receiving tax exemption.
This hasn’t prevented organizations from skating around the line. Think tanks and organizations dedicated to correcting media can lean both to the right and left, for instance. The key distinguishing factor is whether activity is made with the purpose of influencing voters. “A lot of organizations are getting right up to the line and sometimes tiptoeing across it,” said Owens.
Enforcement has dwindled in recent years as IRS resources have become increasingly scarce. Cutbacks on enforcing nonprofits is due to where the money is, Owens musing that the amount of money associated with revoking exemptions is dwarfed by that hidden by individuals in foreign bank accounts, for instance.
Most nonprofits would not be impacted by repealing the Johnson Amendment as they do not engage in political activity. Owens predicted that a repeal would lead to more charities serving political purpose as a 501(c)(3) offering information appears more neutral and unbiased than a political group.
The National Council of Nonprofits supports the prohibition, according to David L. Thompson, vice president of public policy. Thompson described the interest around the Johnson Amendment as relatively recent, picking up in the past six years or so. Staying out of partisan politics, from the council’s perspective, is vital in building strong advocacy.
“We don’t want to create Republican nonprofits and Democratic nonprofits, because the public is confused enough about nonprofits,” Thompson said. “People are fed up with politics. If they see nonprofits as part of the problem, they aren’t going to give their time, talent or treasure. They’re not going to trust us.”
Approximately one-third of the money going into the sector originates from government sources such as contracts for services, according to Thompson. Engaging in partisan politics risks conflicting with nonprofits’ role of both working with and criticizing government and sets up scenarios in which political regimes could tilt funding toward similarly aligned organizations.
There has been some confusion and need for clarification among member organizations, Thompson said, but there has not been a groundswell to change restrictions.
The types of activities prohibited are relatively specific — engaging in partisan election activity. There is a difference between politics and policy, Thompson said. Organizations are free to lobby, criticize policies and correct inaccuracies in others’ reports. Nonpartisan election activity such as promoting voter registration is also permitted.
Engaging in polemics is where the gray area begins. Endorsing a candidate or engaging in activities that look to sway an election are prohibited.
Organization leaders planning to engage in the upcoming presidential election might have trouble passing the smell test if leaders haven’t previously made policy and advocacy a part of programming. Regularly discussing policy or congressional action, for instance, can be constituted as providing an educational benefit. Entering discussions with constituents in hopes of influencing voting, however, is prohibited.
“We see ourselves as a safe haven from politics and we really want to keep it that way,” Thompson said.