A couple of nights ago, Stephen Colbert took on “Pulpit Freedom Sunday,” a protest being mounted by hundreds of pastors against the IRS’ “political activity” regulations.
Here’s the deal: the IRS allows people to deduct contributions to charitable and religious organizations, effectively subsidizing those contributions. If I give 100.00 to my synagogue or church, that gift doesn’t really cost me 100.00. Depending upon my tax bracket, the effective cost to me can be significantly less. In return for that subsidy, the charitable/religious recipients promise–among other things–to refrain from partisan politicking. They can still take positions on the issues of the day; what they are not supposed to do is endorse specific candidates.
The pastor who came on the Colbert Report didn’t see this as a mutually beneficial agreement–he saw it as some form of spiritual slavery, and kept talking about “freeing” the church. On Sunday, he and the other aggrieved clergy will defy the law (as they evidently have on a similar “Freedom Sunday” for the past five years) by issuing a partisan endorsement from the pulpit. According to him, the IRS regulation means the church is being “controlled” by government, and he thundered against any effort to “tax the church,” by which he evidently meant the elimination of this highly preferential tax treatment.
I’m all for giving the churches freedom. Complete freedom. Clergy should be able to say whatever they like, and the IRS should eliminate the current tax policy that allows parishioners to deduct contributions. The church would then be free of the “special rights” and tax benefits that evidently keep it enslaved.
Well it’s both the deductibility of the donations from congregants and the 501c3 status of the churches themselves. Why, if they take in, say, $1,000,000 in income should their federal tax be zero. Often times they take this money in by engaging in essentially commercial activity, such as running coffee shops, pre-schools, etc. They are also not taxed on their purchaes of goods in most states. It’s become a racket and it’s gone on way too long.
Nonprofits, including churches, perform significant public services for the community and, far more effectively than the government, fill gaps in society for the homeless, hungry and needy, not to mention support of the arts, literacy, medical research, environmental protection…. and the list goes on.
This special status allows public services to be provided without the government resources and bureaucracy getting involved. My church or favorite charity can be far more efficient serving the needs of the locals than the government can. That’s the theory behind the culture of nonprofits, and, by and large, it works.
What the pastor in question failed to grasp is that nonprofit status is a public trust – nonprofits stand in the place of the government to provide services that the government can not or will not address. Therefore, nonprofits must act accordingly to preserve their neutrality and status “in place of the government,” and in light of the indirect tax support (in terms of exemption from income and sales tax and charitable deductions afforded to donors) they receive.
Smart nonprofits know how to get their message out without crossing the political endorsement line. Holding a public forum where (all) candidates are invited to state their position on issues important to a particular nonprofit is just one example.
Nonprofit status is a voluntary contract with the government. Those who do not like the terms of that contract are free (and there is where “freedom” comes in) to pursue their agenda without nonprofit status.
As the former chairperson of my church’s “Church and Society” committee, I often struggled with how to determine who was really in need. One of our pastors expressed similar frustration and said the government is actually better positioned to help the poor than the church in most instances. He felt the church was often taken advantage of by drop ins seeking handouts. The church did not ask those requesting assistance to complete any income verification information and had few staff resources to verify the information in any event.
If someone said they needed food, we gave them a voucher at a local store rather than cash that might be spent in other ways, but that’s as close as we came to ‘accountability’. If the government operated in such a loose way with our tax dollars, taxpayers would be very upset.
My church does many good works for people in need here and abroad. For example, we supply food pantries in Indianapolis (where others verify need) and are quick to help when people at home or abroad suffer devastation such as in the Katrina hurricane and Haiti earthquakes. But our church has neither the authority nor staff to investigate people’s financial backgrounds to verify what they tell us.
Some folks (like Mitt Rommney last night) feel the government can never do as good a job as others can on anything. But that assumption is wrong. Medicare spends about 3% of its funds on administrative costs, but private insurance companies spend up to 25% on administration.
Churches do much to help those in need, but it’s not at all clear that they do a better job of it than the government.
So, do contributors to pantheist or atheist groups get a deduction? So, are the “religion clauses” okay with supporting monotheism but not pantheism or atheism?
Thanks for this topic. I have been working with the severely damaged output of American Churches for 36 years. I work with the Gay men who are taught to hate themselves by their godly families. These Churches and the families they mentally corrupt, destroy lives. People who are taught that they are evil sinners from birth tend to be very destructive towards themselves. Their own family turns on them. Black people suffer hatred and discrimination but with Gay people it is their entire world that turns on the…Including their own household. When an institution (The Church) teaches families to turn on their own children, that is child abuse. They should be prosecuted for child abuse. The parents should be prosecuted for child abuse. But the last thing they should get is TAX FREE income. NO WAY. Tax these hate groups. Tax their buildings. Tax their flouncey gowns. Tax their gold rings. Tax it all. And NO Tax deductions for supporting hate groups either. Giving special tax treatment to these folks is a bit like giving a huge tax break to the KKK. Though some are in the same groups. And they are the Republican base that all the “Dog Whistle” talk is directed to.
In the end, they will continue to get their tax breaks
Nothing will change. Darn !!
No doubt Miriam and Nancy’s observations concerning the work of churches and charities is true in a large number of instances. And the overall prohibition on partisan political activity that applies to ALL 501(c)(3) organizations, not just churches, would seem to be a constitutionally justifiable tradeoff for tax exempt status. However, it’s my understanding that these church groups want to go a step further, claiming that because of First Amendment “free exercise” principles, they should be exempt from all taxes, period.