Friday, November 2, 2018
Brunson on Freedom from Religion Foundation's Challenge to Church Exemption from IRS Form 990 Filing
Sam Brunson (Loyola-Chicago) has posted NonBelief Relief and Form 990 on The Surly Subgroup. In this post he describes and analyzes the latest legal challenge from the Freedom from Religion Foundation to the tax benefits enjoyed by churches and other houses of worship. More specifically, this just-filed lawsuit claims that the exemption for such entities from the annual information return requirement applicable to almost all other entities that are exempt from federal income tax under section 501 of the Internal Revenue Code is a violation of the Establishment Clause of the Constitution. The vehicle for this challenge is a secular charity established by the Foundation, NonBelief Relief, that (presumably intentionally) failed to file a Form 990 for three consecutive years and so has now had its exemption revoked by the IRS. Cutting to the chase (see the post for more details), Brunson thinks there is a case here but that "it seems like Congress could enact an exemption like this to avoid the risk of impermissible entanglement" and the exemption is "at least a viable candidate" for a constitutionally permissible accommodation of religion.