Originally published on Forbes.com Sept 7th, 2013
The Freedom From Religion Foundation is on a roll. While its case against the parsonage exclusion is ongoing, it has won standing in two other cases. One case concerns political activity by churches and the other concerns the requirement to file Form 990. Standing is a real lawyerly concept. The idea is that to have access to the courts, you need to argue that the government is screwing you. If you think that the government is screwing up by being too easy on somebody else, you should write your congressman.
I have to say that I am not a great fan of FFRF. I just can’t get excited or see any harm in Ten Commandments monuments. Of course if my neighbor had an ox or a donkey that I coveted, I might feel differently. The two cases that they just got standing on have the IRS as defendant. I’m not that excited about the political activity one, but I think that they really have a good point about the 990. I do believe that the First Amendment “free exercise” clause gives churches special status.
That creates a dilemma, though. I’m currently reading the latest Salinger biography, so you will have to forgive me for stating the problem in Holden Caufield terms.
He said he talked to Jesus all the time. Even when he was driving his car. That killed me. I just see the big phony bastard shifting into first gear and asking Jesus to send him a few more stiffs.
Religion and charitable activities represent some of the highest, most beneficent aspects of humanity. As night follow day, such things will prove a magnet for sociopathic phony bastards.
Let The Sunshine In
Transparency in financial matters will not entirely solve that problem, but it can help a bit. When a not-for-profit sends in its Form 990, it is not just telling the IRS about details of its operations. It is telling everybody, who cares to look.
Perhaps the first instance of the transparency provided by Form 990 shaking up a charity that went off mission was that of Boys Town
.The Omaha Sun’s investigation of the inspiring institution that had morphed into a direct mail money machine got a boost when the paper’s owner, Warren Buffett, told the editor about the new requirement that not-for-profits file Form 990 and make it publicly available. It was a lot harder then. Now most 990s are just a few clicks away on guidestar.org. Whenever I write about a case concerning a not-for-profit, I always check the 990 and often come up with interesting side-lights. Unless the not-for-profit is a church. Churches are not required to file and I can think of no good reason for them not to. Except for the ones that are run by phony bastards. It is hard to see how financial transparency interferes with “free exercise”.
It is not just me thinking that churches should be financially transparent. The Evangelical Center for Financial Accountability goes one step beyond and requires its members to make audited financial statements available:
The financial statements (and the disclosure of the financial statements) are key components of transparency, both within the ministry and to donors and the public. This flows directly from biblical principles: “This is the verdict: Light has come into the world, but men loved darkness instead of light because their deeds were evil. Everyone who does evil hates the light, and will not come into the light for fear that his deeds will be exposed” (John 3:19-20 NIV).
Transparency serves to deter improper diversion of funds and other misdeeds. It also provides a defense to critics and a witness to both believers and nonbelievers. When Jesus was arrested, He said to the crowd, “Am I leading a rebellion, that you have come out with swords and clubs to capture me? Every day I sat in the temple courts teaching, and you did not arrest me” (Matthew 26:55 NIV). The openness of His public actions revealed a significant contrast to His middle-of-the-night arrest.
The Apostle Paul, too, did his deeds openly. He cites this fact as one basis for his authority over the Thessalonians. “You are witnesses, and so is God, of how holy, righteous, and blameless we were among you who believed” (1 Thessalonians 2:10 NIV). Being transparent with one another assures credibility and authority.
Wouldn’t it be great if ECFA put in an amicus brief backing the FFRF in this one case ?
The ruling on standing followed the same logic as the court’s previous ruling about the parsonage exclusion. FFRF has to file 990s, churches don’t. That is a legitimate beef to litigate.
The Political Case
In its other lawsuit, FFRF is alleging that IRS has a policy of not enforcing the rules against political activity by not-for-profits when it comes to churches. The court ruled that FFRF has to refrain from endorsing candidates and the like, so if the IRS has a policy of not going after churches for that type of activity, FFRF has the right to litigate about it.
This case seems to be a reaction to “Pulpit Freedom Sunday”
The Alliance Defending Freedom “Pulpit Freedom Sunday” is a strategic litigation plan. Through tactical lawsuits against the Internal Revenue Service (IRS), Alliance Defending Freedom seeks to restore the right of each pastor to speak scriptural Truth from the pulpit about moral, social, and governmental issues — as well as other topics concerning his congregation — without fear of losing his church’s tax-exempt status.
As my father used to say “Discretion is the better part of valor”. The IRS has limited resources and its main mission should be collecting taxes. Given all the other problems it has having with the never-ending scandal, it seems perfectly reasonable to me, that the Service is not taking the bait that Alliance Defending Freedom is tossing out.
Counting parsonage, that makes three cases that FFRF is pursuing against the IRS essentially encouraging it to be harder on certain taxpayers. Personally I would like to see Congress take some responsibility in all three areas. Place some reasonable dollar limit, not indexed for inflation, on the parsonage exclusion so it can be gradually phased out. Require churches to meet whatever requirements other not-for-profits meet. Finally, if political speech must be regulated, put the regulation in the hands of the Federal Election Commission and let the IRS focus on collecting taxes.
You can follow me on twitter @peterreillycpa.