Campaign Activity by Churches: Legal Analysis of Houses of Worship Free Speech Restoration Act
Publication Date: June 2004
Publisher: Library of Congress. Congressional Research Service
Author(s):
Research Area: Culture and religion; Politics
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Abstract:
Churches and other Internal Revenue Code (IRC) Section 501(c)(3) tax-exempt organizations can lose their tax-exempt status if they participate in a political campaign. The Houses of Worship Free Speech Restoration Act, H.R. 235 (108th Congress) would permit churches to engage in unlimited amounts of certain types of political campaign activity without jeopardizing their tax-exempt status. It would amend the IRC so that churches could not lose their tax-exempt status "because of the content, preparation, or presentation of any homily, sermon, teaching, dialectic, or other presentation made during religious services or gatherings." H.R. 235 is similar in purpose to the Houses of Worship Political Speech Protection Act, H.R. 2357 (107th Congress), although the 107th Congress bill took a different approach. H.R. 2357 received a floor vote on October 2, 2002, and failed to pass by a vote of 178 to 239.
H.R. 4520 (108th Congress), the American Jobs Creation Act of 2004, had included a provision addressing the participation of churches in political campaign activity, but the Committee on Ways and Means struck the provision by unanimous consent on June 14, 2004. The provision, former section 692 (Safe Harbor for Churches), would have codified existing law on the consequences to churches of statements made by religious leaders as private citizens, allowed churches to make a limited number of unintentional violations of the political campaign activity prohibition without jeopardizing their taxexempt status, and imposed a sanction on unintentional violations of the prohibition.
These provisions appear to respond to Branch Ministries v. Rossotti, 211 F.3d 137 (D.C. Cir. 2000), where the U.S. Court of Appeals for the D.C. Circuit upheld the authority of the Internal Revenue Service (IRS) to revoke the tax-exempt status of churches that engage in prohibited campaign activities. This report provides an overview of current tax and campaign finance law relevant to this legislation, a discussion of how H.R. 235 (108th Congress), H.R. 4520 (108th Congress), and H.R. 2357 (107th Congress) would amend current law, and a comparison of the three bills. This report will be updated as developments occur.