As previously reported, in a suit brought against the Internal Revenue Service by two churches and two other non-profit religious groups challenging the Johnson Amendment, the IRS joined plaintiffs in filing a proposed Consent Judgment. The Consent Judgment proposed that the court issue an order enjoining the IRS from enforcing the Johnson Amendment against the churches. It enunciated a new IRS policy of permitting houses of worship to engage in speech concerning electoral politics viewed through the lens of religious faith made to their congregations in connection with religious services through their customary channels of communication on matters of faith. This would permit clergy to endorse political candidates from the pulpit. However, now the Texas federal district court in which the suit is pending has refused, on jurisdictional grounds, to adopt the proposed consent decree. In National Religious Broadcasters v. Bessent, (ED TX, March 31, 2026), the court held that the Tax Anti-Injunction Act and the related tax-suit bar in the Declaratory Judgment Act deprive it of jurisdiction to enter the proposed injunction. The court said in part:
The government cites no authority for its position that its own consent to an injunction regarding a condition for tax benefits creates jurisdiction that the AIA or DJA otherwise denies....
Other fora, however, may be available. A refund suit could be brought if a tax were ultimately collected.... And an exception in 28 U.S.C. § 2201(a) now allows a ... declaratory suit—available in one of three courts headquartered in the District of Columbia— if the IRS were to make any determination with respect to an organization’s § 501(c)(3) tax-exempt status. A dispute in that posture would also have the benefit of a specific set of facts upon which the IRS made a determination.
Americans United for Separation of Church and State which had sought to intervene in the case to oppose treating houses of worship differently than secular nonprofits issued a press release reacting to the decision. Texas Tribune reports on the decision.
