Saturday, July 19, 2014

FFRF and IRS Settle Suit On Non-Enforcement of 501(c)(3) Against Churches

The Freedom From Religion Foundation announced Thursday that it has reached a settlement agreement with the Internal Revenue Service in Freedom From Religion Foundation v. Koskinen, a suit (links to pleadings) challenging the IRS's alleged non-enforcement against churches and religious organizations of the Section 501(c)(3) ban on political activity by non-profits. (See prior related posting.)  According to FFRF:
A prior lawsuit in 2009 required the IRS to designate an appropriate high-ranking official to initiate church tax examinations, but it had apparently failed to do so. 
The IRS has now resolved the signature authority issue necessary to initiate church examinations. The IRS also has adopted procedures for reviewing, evaluating and determining whether to initiate church investigations. While the IRS retains “prosecutorial” discretion with regard to any individual case, the IRS no longer has a blanket policy or practice of non-enforcement of political activity restrictions as to churches.
Church audits will not begin immediately because the IRS now has a broader moratorium in place on investigation of any tax-exempt organizations because of the Congressional investigation of its alleged targeting of conservative groups for adverse treatment.