A Baptist church in the nation’s capital is requesting a day in court before a federal court rules in a lawsuit by an atheist group that lost its tax-exempt status for failing to file a form not required for churches and other religious organizations.
NonBelief Relief, a humanitarian agency incorporated in 2015 by the Freedom From Religion Foundation as a separate 501(c)(3) non-profit charity, sued the IRS in October claiming its tax-exempt status was unfairly revoked.
The revocation came after the organization failed to file the IRS Form 990 for three straight years. The form requires tax-exempt organizations to provide information including financial statements, who is on their board of directors and the salaries of highly paid employees.
Churches and their “integrated auxiliaries,” such as associations, conventions and denominational mission societies, are not required to file the form, a statutory exemption that the lawsuit claims unfairly favors religion over non-religion. It asks the U.S. District Court for the District of Columbia to enjoin the IRS “from continuing to preferentially exempt churches and other affiliated religious organizations from annual information filings required of other non-profit organizations.”
Pastor Patrick J. Walker says the New Macedonia Baptist Church has a stake in a lawsuit seeking to require churches like his to file an IRS Form 990 in order to keep their tax-exempt status.
The New Macedonia Baptist Church, a DC church affiliated with the Lott Carey Global Christian Missional Community, on Nov. 21 filed a motion to intervene in the case. The pastor, Patrick Walker, signed a declaration saying that losing the exemption would significantly burden the church’s ministry.
“Instead of using all of its resources to further its religious purpose and activities, the church would have to expend substantial amounts of time, energy, and money preparing and filing detailed annual returns with the IRS,” Walker said. “This would burden and interfere with the church’s ability to live out its faith and mission.”
Walker said additionally that requiring the church to file an annual information return such as Form 990 would make “sensitive and confidential information related to the church’s governance, ministry expenses, compensation of pastors and other key employees, and financial contributions made to the church, among other things” available to the general public.
Should the church refuse to comply, the pastor said, it would risk losing its tax-exempt status, and that would be “devastating” to the church budget, likely causing a reduction in staff and curtailing or ending certain ministries.
Attorneys for the Alliance Defending Freedom said in the motion to intervene that filing such returns would not only require churches to expend time and money that could otherwise could be spent on ministry but would also cause “sensitive and confidential information about the church to be disclosed to the federal government and general public.”
“Requiring churches to file tax returns with the IRS places too much power — and too much sensitive information about church operations and finances — in the hands of the government,” said ADF Senior Counsel Erik Stanley. “That’s why the First Amendment legitimately blocks any requirement that churches file such returns.”
The atheist group argues in the lawsuit that the preferential filing exemption for churches and certain other religious organizations violates the Establishment Clause of the First Amendment to the U.S. Constitution.
“Form 990 requires disclosures that provide information to the public that facilitate informed decision-making, but that purpose is not unique to non-religious charitable organizations,” the lawsuit says. NonBelief Relief, which is not a church or an integrated auxiliary of a church, “objects to having to file Form 990 while churches and church-related organizations do not.”