Did the LDS violate their tax-exempt status rules?

[drwex]

I'm not generally in favor of harassing churchfolk, whether it's churchfolk I like or churchfolk I don't. I do generally prefer that the churchfolk stay in church and out of the political arena. There's a reasonable argument to be made that the Church of Jesus Christ of Latter-Day Saints violated its tax exempt status by its heavy involvement in the political issues surrounding the anti-gay ballot initiatives.

The consequent of that argument is that if the LDS church violated the rules under which it enjoys tax exempt status, then it ought to lose that status and be penalized. The argument in favor of this position is made here: http://jesshartley.livejournal.com/376470.html and in the links from that post.

I'm not at all convinced by the claim that the church "clearly" ought to lose its status, but there does seem to be reasonable grounds for a full investigation.

Comments

[rmd.livejournal.com]

as i understand it, the problem is that the propositions are considered nonpartisan, so it's not the same as "YOU SHOULD VOTE FOR FRED"

[awfief.livejournal.com]

Yes.

In addition, many not-for-profits will incorporate a 501(c)4 for the purpose of political organizing or lobbying. MassEquality has done that.

This is a good summary (it's not directly from the IRS, but you can go to irs.gov and research more if you'd like)

http://nonprofitmanagement.suite101.com/article.cfm/what_is_a_501c4_organization

Lobbying (trying to affect legislation):

* 501(c)3s are limited in the amount of time and/or money they can put into lobbying.
* 501(c)4s can do an unlimited amount of lobbying (but then become ineligible to receive federal monies like grants).

Political campaign activity:

* 501(c)3s cannot in any way support or oppose anyone running for public office, though they may be involved in political campaigns by way of non-partisan public forums, voter registration drives, etc.
* 501(c)4s can engage in political campaign activity, so long as this is consistent with the organization’s purpose and is not the organization’s primary activity.



And in a page linked from the previous one:

http://nonprofitmanagement.suite101.com/article.cfm/can_nonprofits_lobby

Under the provisions of the Internal Revenue Code (IRC) 501h, most 501c3 nonprofit organizations (with the exception of churches and church-affiliated organizations):

* Can appeal directly to state legislatures regarding public policy they’d like to see happen or legislation they’d like to see defeated or repealed. The organization can write letters, make phone calls, or meet face-to-face with the legislator.
* Can lobby for issues-based initiatives. For instance, half of the states in the U.S. allow citizens to take ballot initiatives directly to the voters, and 501c3 nonprofits can campaign in those instances.

[drwex]

But religious groups aren't the usual non-profits. They seem to have a different rule-set under which they are supposed to operate. And which I feel they've been vigorously flouting in the past few years.

(It's not just the LDS/Prop 8 I'm thinking of here - there was a group of clergy that publicly declared their intention to challenge this ban by having pre-election-day sermons from the pulpit that explicitly endorsed candidates. And nothing seems to have been done about that, either.)

[gentlescholar.livejournal.com]

Back in 2004 some clergyman was forced to resign from his parish over his urging people to vote for Bush. I forget the story, somewhere on the East Coast I think.

[awfief.livejournal.com]

There are special rules, however, it's not as different as you think.

If you want to say something is against the rules, you should research those rules first. I'm annoyed that you didn't just do this yourself, but I did it for you because I hate seeing "But don't they break the rules? I don't know the rules! You're telling me what the rules are, but I don't think that's right!"

check out
http://www.irs.gov/charities/churches/index.html
which also links to
http://www.irs.gov/charities/charitable/article/0,,id=163395,00.html

which states that no 501(c)3 can behave in a partisan manner. However, they can do ballot initiatives. There's a link from that page to

http://www.irs.gov/charities/charitable/article/0,,id=179738,00.html

which talks about compliance to those standards, another link to the examination procedures:

http://www.irs.gov/charities/charitable/article/0,,id=179671,00.html

which links to the procedures on how to examine not-for-profits for whether they're engaging in prohibited political activities -- and also the special rules about examining a church.

Go forth and read, and make another post if you've actually determined there's some rule/code/law been broken.

[drwex]

I think you're basically right, and it's certainly possible that the IRS would rule that backing a ballot initiative is allowed political activity. But an effort to amend a state constitution seems to be pretty direct involvement in the political process, which I thought might be a no-no. Thus I think it's reasonable to call for the IRS to investigate, without prejudging how the investigation should turn out.

[awfief.livejournal.com]

And that's why it's so dangerous to have ballot initiatives that directly affect things like the Constitution. Massachusetts doesn't have that -- http://ballotpedia.org/wiki/index.php/Massachusetts_Initiative_and_Referendum_Law -- ballot initiatives don't change anything, they just kinda 'strongly recommend to the legislature' to do something.

Which is a check/balance.