The Freedom From Religion Foundation sued the Internal Revenue Service for failing to enforce electioneering restrictions against churches and religious organizations, calling it a violation of the Establishment Clause of the First Amendment and of FFRF’s equal protection rights. FFRF filed the lawsuit Nov. 14, 2012, in U.S. District Court for the Western District of Wisconsin. At the time of our suit, the IRS had not publicly announced any church audits since 2009, when a federal court in Minnesota ruled that an IRS official who had authorized a church audit was not of sufficient rank. After a restructuring in 1998, the IRS had not designated officials who could institute audits under the Church Audit Procedures Act of 1984.
The lawsuit, FFRF v. Koskinen, (12-cv-818), was filed by attorney Richard L. Bolton (originally FFRF v. Schulman). FFRF sought to enjoin IRS Commissioner John Koskinen (originally filed against former Commissioner Douglas Shulman from continuing “a policy of non-enforcement of the electioneering restrictions against churches and religious organizations.” Additionally, FFRF seeks to order Koskinen “to authorize a high-ranking official within the IRS to approve and initiate enforcement of the restrictions of §501(c)(3) against churches and religious organizations, including the electioneering restrictions, as required by law.”
At the time of the filing, FFRF had more than 19,000 members nationwide “who are opposed to government preferences and favoritism toward religion.” This non-enforcement “constitutes preferential treatment to churches and religious organizations that is not provided to other exempt organizations, including FFRF,” the complaint notes. “Churches and religious organizations obtain a significant benefit as a result of being non-exempt from income taxation, while also being able to preferentially engage in electioneering, which is something secular exempt organizations cannot do.” This preferential tax exemption involves more than $100 billion annually in tax-free contributions to churches and religious organizations in the United States.
FFRF reached an agreement with the IRS in July 2014 that resolves, for the time being, the issues in FFRF’s federal challenge. Specifically, FFRF was informed that since 2010, the IRS has flagged churches involved with political intervention, including churches that submitted materials as part of “Pulpit Freedom Sunday.” FFRF was also informed that an IRS review committee determined that 99 churches were marked for “high priority examination.” The IRS could take enforcement action against some of those churches, which were marked for potential illegal political intervention between 2010-13. Since the IRS demonstrated it does not have a blanket policy or practice of non-enforcement of political activity restrictions, the parties moved for a joint dismissal of the case.
On August 1, 2014, U.S. District Judge Lynn S. Adelman issued an order granting the joint motion for dismissal between FFRF and the IRS. Adelman’s decision and order agreed that FFRF may voluntarily dismiss its lawsuit “without prejudice,” meaning FFRF can renew the lawsuit if the IRS reverts to its previous inaction.
- Press release
- IRS Motion to Dismiss
- FFRF Response Brief
- Government's Reply Brief
- Church Motion to Dismiss - Decision and Order
- Church Motion to Intervene
- Brief in Support of Motion to Intervene
- Father Malone Declaration
- Government Opposition to Church Motion to Intervene
- FFRF Opposition to Church Motion to Intervene
- Church's Reply to Motion to Intervene
- Decision and Order by Adelman allowing church intervenor, Feb. 3, 2014
- Joint Motion to dismiss, July 17, 2014
- Church Opposition to Motion to Dismiss
- Gov't Reply in Support of Motion to Dismiss
- FFRF Reply in Support of Motion to Dismiss
- Church Brief in Sur-reply
- Press Release: FFRF, IRS settle suit over church politicking
- Decision and Order, July 29, 2014
- FAQ on case