The Freedom From Religion Foundation, which has sued the IRS over tax code inequities favoring churches over secular nonprofits, is condemning the growing trend of right-wing groups evading financial scrutiny by reorganizing as churches.
FFRF contends that not only is this a scam, but it also has real-life political consequences in a nation increasingly divided by Christian nationalist attacks on secular government.
ProPublica just published an exposé reporting that the Christian nationalist group Family Research Council was allowed by the IRS to change its status from nonprofit to an “association of churches” in March 2020. (Identifying as an “association of churches” is typically a designation for groups with member churches, such as the Southern Baptist Convention.)
The Family Research Council told the IRS that the classification change would protect its religious liberty rights, such as being exempted from having to cover contraception. The organization is classified as a hate group by the Southern Poverty Law Center.
Focus on the Family, based in Colorado, changed its designation in 2016. MinistryWatch, which monitors evangelical institutions on behalf of evangelical donors, previously reported that the Billy Graham Evangelistic Association also changed its status to avoid making public its financial situation.
By becoming churches, these nonprofit evangelical associations are able to avoid having to fill out the Form 990 that all nonprofits — other than churches — are required to file, to account for what they do with tax-exempt donations, which are essentially subsidized by the public. “These organizations are using this exception to keep not only the government, but also donors, from seeing how their money is being spent,” charges MinistryWatch.
MinistryWatch in 2019 listed other Christian-right or evangelical organizations that have recently claimed the church exemption, including: Cru (formerly Campus Crusade for Christ), Gideons International, Ethnos 360/New Tribes Mission, Denison Ministries, Voice of the Martyrs, Frontiers, and Ravi Zacharias International Ministries, among others.
The Washington Post reports that evangelical leaders of nonprofits claim they are changing the status to avoid onerous administrative costs or to protect donor confidentiality. That is bogus, since nonprofits are allowed to redact donor information from versions shared online.
“Saying they can’t afford to file Form 990s is a pathetic excuse,” asserts Annie Laurie Gaylor, FFRF co-president. “FFRF paid $1,500 to have CPAs prepare our latest Form 990, which, to these evangelical entities swimming in funds, is a pittance.”
ProPublica reports that Family Research Council had average revenues of $15.9 million a year, and in 2021 brought in $23.1 million, with Tony Perkins reporting a salary of $300,000 when last filing a Form 990. Many CEOs who head major evangelical outfits draw lucrative salaries — one reason why they may prefer to avoid filling out Form 990s, which list nonprofit CEO salaries.
“At FFRF as a 501(c)(3) nonprofit, we consider tax exemption a privilege and public trust,” Gaylor adds. “Churches trade on reputations as do-gooders and philanthropists. What are they hiding? Where public subsidy goes, public accountability should follow.”
In the case of the multimillion-dollar Family Research Council, which is situated near the U.S. Supreme Court building, it pushes a Christian nationalist agenda that is anti-abortion, anti-LGBTQ and seeks religious exemptions to civil rights laws. Perkins is credited with turning the Republican Party planks into vehicles of Christian nationalism.
Shockingly, the IRS permitted Liberty Counsel — the Christian nationalist group representing Kim Davis after she refused to issue same-sex wedding licenses in Kentucky — to reclassify in 2018 as an “association of churches.” This is the same group that submitted an anti-abortion brief in the Dobbs decision overturning Roe v. Wade and whose staffer just claimed she prays with justices inside the Supreme Court building, leading FFRF to call on the chief justice for an investigation.
A high-profile Christian nationalist group that changed its tax status to a church this year is the Mississippi-based American Family Association, famous for its anti-abortion and anti-LGBTQ boycotts.
FFRF brought not just one but two cutting-edge lawsuits seeking to challenge the fact that nontheistic nonprofits must file Form 990s, while churches or church-related charities are exempted from the filings. The first was thrown out, saying FFRF would have to stop filing Form 990s before it would have standing to sue, jeopardizing its charitable status. In the second instance, after FFRF’s board created an affiliated charity, Nonbelief Relief, the case was dismissed by a judge after it lost its tax-exemption when it failed to file the Form 990 for three years in a row.
The Freedom From Religion Foundation is the nation’s largest association of freethinkers (atheists and agnostics), with more than 37,000 members, and works to keep religion out of government.