Guest Blogger

Attacking Tax-Exemptions for Churches a Lose-Lose Proposition

Filed By Guest Blogger | November 12, 2009 9:30 AM | comments

Filed in: Living, Marriage Equality, Politics, The Movement
Tags: lose-lose proposition, Nonprofit Industrial Complex, Sam Ritchie, tax exempt

Editors' Note: Guest blogger Sam Ritchie is a writer and activist who lives with his husband of twelve years in Crown Heights, Brooklyn. He writes, edits and manages online content for the American Civil Liberties Union's LGBT & AIDS Projects. He also blogs, intermittently, at Prayers for Rain.

blue.jpgOn November 4, the day after marriage in Maine was repealed by yet another church-backed ballot initiative, a gay activist in Tennessee started a Facebook page dedicated to revoking tax-exempt status from the churches that participated. In a week, he gathered over 60,000 fans, all of them eager to make anti-equality churches pay for their sins. But there's a big problem with their plan: The churches didn't do anything wrong.

I know. A year ago, after Prop 8 passed, I was eager to do the exact same thing. Then I did some research into the finer details of tax law. You know what? The law is some tricky shit. The rules that ban charities from backing a candidate in an election don't apply the same way to ballot measures. And even if we could prove that a church went over the vague spending limits that apply, we'd end up giving anti-equality churches a battering ram to use against us for the next two decades. I can see the headlines: "Gay activists destroy church over same-sex marriage." How's that going to play in Peoria?

Churches - or any 501(c)(3) - can support or oppose ballot measures

There's a lot of confusion about what churches - and other non-profit organizations - can or can't do and still retain their tax-exempt status. The tax code is very clear that 501(c)(3) organizations cannot support or oppose candidates for public office. It is also clear that 501(c)(3) organizations can engage in issue lobbying, as long as this lobbying doesn't constitute a "substantial" part of the organization's activities.

That's where the clarity ends, however. What constitutes "substantial?" How do you define "lobbying?" And how does this all apply to the churches that backed Prop 8 and Question 1?

Well, the answer to the "substantial" question is murky, and there are two different tests a non-profit can use, but generally, the limit seems to be somewhere between 5-20% of budget, depending on the size of the organization. What constitutes lobbying is also not completely clear, but for this purpose, the IRS has decided that supporting or opposing ballot measures are included as lobbying.

That means any 501(c)(3) organization - including churches - can legally spend 5-20% of their budget supporting or opposing a ballot measure and not put their tax-exempt status at risk. So, unless someone can prove that a church went over their spending limits, there is no chance that the IRS will revoke a church's tax-exemption just for backing Prop 8 or Question 1.

Attacking churches turns off moderate voters

So what if we did find a church that went over its spending limits and were able to successfully lobby the IRS to revoke its tax-exempt status? What exactly would we be winning?

A victory would definitely be a warning to other churches: if you don't play by these rules, we'll get you. But if most churches that gave to Prop 8 and Question 1 are already playing by those rules, that's not a huge benefit for our side. Churches that aren't involved in ballot questions would have an example of the perils of politics, but would also get a primer on how to participate and keep their tax-exemption, so that could be a wash.

One thing we'd get out of having a church's tax-exempt status revoked is revenge. Revenge for all the rights we've had revoked by Prop 8 and Question 1. It would be hugely satisfying in the same way that it's satisfying when a kid who has been bullied turns around and lands a punch square on the jaw of his or her tormentors. After being so ruthlessly bullied by homophobic churches, it would be so sweet to get one chance to bully back.

But at what price revenge? One of the more successful tactics used by religious opponents of equality is perpetuating the myth that same-sex marriage (or even anti-discrimination laws) will infringe on churches' ability to operate according to their beliefs. Marriage equality, they claim, will force churches to recognize marriages that they do not believe are valid, force them to participate in same-sex wedding ceremonies and even censor their religious teachings that oppose homosexuality. The National Organization for Marriage even includes loss of tax-exempt status as one of the talking points posted on their web site.

The idea that same-sex marriage will force churches to abandon their beliefs is one that repels the middle-of-the-road voters we need to reach to win at the ballot box. NOM and the Heritage Foundation are already trumpeting a situation in New Jersey where a Methodist organization refused to let a lesbian couple rent a "public" beachfront pavilion for a civil union ceremony, then lost their property tax exemption on the pavilion after the couple complained. Imagine the field day they'd have if marriage activists were successful in getting a church's entire tax-exempt status revoked! They'd portray it as the church simply speaking out about their beliefs and then being persecuted for it. And, sadly, it would work.

As much as I would love to stick it to the churches and organizations that have been so active in denying us our rights, it just seems like a distraction and waste of time, at best, and potentially harmful at worst. Going after the churches would satisfy a deep emotional need to get revenge on those who have done us wrong, but ultimately, would get us no closer to true equality. Let's take the high road here and focus on what we can do to win, rather than how we can punish our opponents.

Besides, conventional wisdom says winning is the best revenge and that it's a dish best served cold. Winning marriage a few years down the road, as I know we will, will be the best revenge of all.


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I wonder how many of the "fans" like myself (and you, I'll bet)are merely there to keep tabs.

There's a group trying to get Facebook to add a "dislike" option. I wish there were a "not a fan" option that would still allow you to view the goings-on.

I don't know if I agree. There's something to be said for the value of making a point, especially when considering future battles.

The fact is that is we continue turning the other cheek, playing fair and by the rules, we're going to continue getting steamrolled at the polls because the other side is fully committed to drawing blood and doing as much damage as they can.

There is a lesson to be learned about the tactics we've been using in these fights: When your record is 0-31, it's time to change your strategy and start becoming as aggressive in defending our values as our opponents are in defending theirs.

That's the lesson our community needs to learn and take to heart. The other side is playing for keeps. It's about time we started doing the same.

I don't think Sam is saying that we should never "draw blood" but our motives and strategies behind such acts should be well planned for maximum benefit. I read his argument as saying that this just wasn't the best motive or strategy to meet our overall goals.

If you ask him, my guess is he'd buy in to a real scrap at this point.

Also, although I think we need perfect our strategies in these fights, I don't know that our loses reflect a total failure on our part. In many of these cases, the tyranny of the majority is our downfall. I don't think our founders intended for people to be able vote on the fundamentally fair/reasonable rights of others.

My 2 cents.

I must disagree. I think an 0-31 record is the very definition of failure. What would you call a sports team that had such a record? I think the word "loser" would come up a lot.

The HRC-style genteel non-confrontational begging to be treated fairly just doesn't work. It's been proven over and over and over, yet we inexplicably still see these tactics repeatedly employed and consistently fail.

Diplomacy has failed to deliver a positive result, every single time. It's time our community recognized that we are at war. We are under direct attack by the forces of the right and if we don't start fighting back on the battlefield, using the very same kind of weapons our enemies use right now, eventually diplomacy won't matter because by the time the Congressional cowards eventually get around to treating us as equals under the law there will have been so much damage done at the state and local levels that it just won't matter anymore.

It's time this community understood that we are in the fight of our lives here. It's time we started fighting back like our lives depended on it, because they most certainly do.

I completely agree with you, Rebecca. We do need to step up our tactics and start fighting back hard. I'd love to see a new generation of ACT UP style activism in support of LGBT equality. Protests, sit-ins, picketing, boycotts - the works!

All I'm saying is that this particular tactic looks like a loser to me. It would take a huge amount of work to accomplish for even one church and doesn't get us real progress. I think we need to keep our eyes on the real prizes - like ENDA, DADT & DOMA repeal, getting nondiscrimination laws in the states that don't have them (and adding gender identity protections in states, like mine, that are sexual orientation only). All of which would really help LGBT folks.

So I'm ready to fight back, just not this way.

I'm of two minds in this. First I want us to fight and to start doing so in a more comprehensive and confrontational way that is direct and strong.
As long as we play too nice we make it comfortable for politicians to keep us on a back burner.
But I also question the value of attacking these Churches tax exempt status. I am fine with attacking them but not on the technicality of the rules for taxes. Lets attack them by showing their pattern of bigotry and really make that our big point along with the idea that they pose a threat to freedom if they can enforce their own religious views as law.

It's all a bit too vindictive and scorched-earth for me. Remember, there were churches on our side, too, and I'd hate to thank our allies for their hard work by inadvertently revoking their tax-exempt status.

We should also remember that churches aren't just involved in gay-rights issues; without leadership from churches, for example, the civil rights movement of the '50s and '60s wouldn't have gotten anywhere.

Screw the religious. They have persecuted us long enough. I am for changing the tax code to do away with exemptions for churches altogether. Why should they get a tax exemption for a business that is just a propaganda machine for a particular cult? Makes no sense to me at all.

Thanks! A well-reasoned position- and one sure to make people think (if they make it through the whole post w/out letting their anger get the best of 'em....).

Yes, well how about Churches that ATTACK the poor because they don't like gays. Thus up on GoodAsYou. http://tinyurl.com/yb7l6hl
The Catholic Archdiocese of Washington said Wednesday that it will be unable to continue the social service programs it runs for the District if the city doesn't change a proposed same-sex marriage law, a threat that could affect tens of thousands of people the church helps with adoption, homelessness and health care.
...
Sent this to Michael C. awaiting his reply.

Rodney Hoffman | November 12, 2009 1:53 PM

I've long favored taxing all churches. Their political activity is only part of why I feel that way.

Why should any idiot who starts any kind of church be tax-exempt? Why should their radio and TV shows be tax exempt?

Why should I be forced to subsidize televangelists who prey on the gullible and usually lie about me and oppose me politically?

Churches, preachers, religions, and religious texts get entirely too much undeserved prominence and respect in the U.S.

I don't much care for "mainstream" religions and churches, either. Tax them all.

Robert Ganshorn Robert Ganshorn | November 13, 2009 9:24 AM

Here you get me Rodney. Tax all of them. If they use land like any homeowner (or other business) tax them. Tax them because we are a secular country. Tax every church, mosque, temple etc. without prejudice. Local taxing authorities could use the money and maybe to provide tax relief to homeowneers.

This would also eliminate a number of borderline churches that are really not churches at all, but a tax write off for extended families.

They would cry and moan and use every method on "K" street to protest, but how can they if they believe in equality for all? The truth is none of them believe in equality and will move heaven and earth to avoid being equal. They will couch it in comments about their many "good works" in their communities, but if they want to perform good works they will do them anyway. They must be superior. All churches, Gay friendly or not should be taxed and the resolve of their members will keep them open or force them to close. Why should anyone who pays property tax anywhere in America subsidize anyone else's religion? It is the greatest mystery to me and has been for thirty years.

The Roman Catholic Church alone is so wealthy in land, as she pleads eternal poverty, as to bugger the imagination. Colorado Springs "Focus on the Family" is an unbelievable sight in the mountains surrounding. It is an insult to a secular society. Religious freedom does not equal subsidizing religion from the public purse.

I have no problem with people believing in a religious concept and doing what they refer to as worshiping a god. It's the leadership of many religious organizations that bother me, especially when they take donations from their congregations and use those funds for something other than charity. Religious Corporations are kind of an oxymoron to me and I see no problem with taxing corporations! How can a Corporation claim to be a religious institution? Maybe we should claim that all people of the alternative sex/gender community a Queer Faith, we could become tax free and incorporate. What I see from the religious right is nothing more than Fascism, all they want to do is make everyone obey them, while they take and take and take form the from the naive who give and give and give. I prefer to be free, I've never had anything against charity for those in need of help. If you look at it, Fascism has taken hold of the religious and it is joined at the hip with our political process for something other than worshiping a god. If it acts like a Fascist, talks like a Fascist, it can't be any clearer than that.

I have no problem with people believing in a religious concept and doing what they refer to as worshiping a god. It's the leadership of many religious organizations that bother me, especially when they take donations from their congregations and use those funds for something other than charity. Religious Corporations are kind of an oxymoron to me and I see no problem with taxing corporations! How can a Corporation claim to be a religious institution? Maybe we should claim that all people of the alternative sex/gender community a Queer Faith, we could become tax free and incorporate. What I see from the religious right is nothing more than Fascism, all they want to do is make everyone obey them, while they take and take and take form the from the naive who give and give and give. I prefer to be free, I've never had anything against charity for those in need of help. If you look at it, Fascism has taken hold of the religious and it is joined at the hip with our political process for something other than worshiping a god. If it acts like a Fascist, talks like a Fascist, it can't be any clearer than that.

battybattybats battybattybats | November 12, 2009 11:04 PM

How about just remove the tax exemption from any church-owned business and sales of anything and any non-cereminial/building/maintanance etc.

Call it unfair-competition. Cause frankly a church-owned food products company or dvd company or music cd company being tax-exempt is by defintion anti-competative.

Surely there is no reason that tax-exemption cannot be narrowly defined as just for the purposes of having a place of worship, the acoutrements of worship and the cleaning etc of said place of worship?

And with the mass profits no longer in it and the breaks applied to the gravy train i think we'd see a lot of hanges for the better.

I couldn't disagree with the author more - and I think he misses the point. No one is saying that churches are disregarding the existing rules. The key is to get the rules changed, and that should come via court decisions down the road. The ACLU can and should do this 'for' us - and it needn't have a huge banner of 'gay rights now!' stamped on the court filing papers. I'd also like to know how the author presumes that changing the tax rules will turn off the moderate voter? To my experience, more and more moderate voters are attending church less these days, or at least being more discerning regarding the pulpit pronouncements they endure. I'm also troubled by the author's rosey conclusion that we will win our rights 'a few years down the road'? Given the defeats we've suffered, I'm not convinced I'll see it in my lifetime, at this point. And even if we do, that's no reason to tolerate a tax system that fosters fat, hate-mongering preachers who give very little $ to charities when their accounting books are finally revealed to the light of day.

Thanks for your comment Jim. It's true, we could, as a community, switch our focus from getting LGBT equality to getting tax exemption revoked from churches, an equally herculean feat. But what would be the point of that? After years of work we STILL wouldn't have equality, just revenge. I'm suggesting we stick with working to gain our rights instead of following some tangent out of spite.

I'm not a lawyer, and these views are my own, not those of my employer. That said, from what I understand of case law in this area, the courts have pretty consistently ruled that it is neither required nor prohibited for the government to include religious institutions in the definition of which charitable organizations get a tax-exemption. That means it's up to Congress. The courts aren't going to change the rules for us. And getting a change like that out of Congress, IMHO, would be harder than getting them to repeal DADT and DOMA.

John Appledon | November 15, 2009 3:09 PM

I hope that the people who join this campaign understand that the goal is NOT the revocation of tax exempt statuses for politically active churches.

What better way to get people to think about the negative influence of the church than to shift the debate away from such things as gay rights and onto such things as the Mormon balance sheet?