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JOHNSON AMENDMENT HELPS PRESERVE CHARITABLE INTEGRITY
The Trump Administration and key Republican members of Congress are leading an effort to repeal the current prohibition on charities intervening in political campaigns on behalf of or in opposition to candidates for public office.
Background: In 1954 then-Senator Lyndon Johnson added an amendment to the Internal Revenue Code prohibiting tax-exempt charitable organizations from participating or intervening in political campaigns on behalf of or in opposition to candidates for public office. For over 60 years, the so-called “Johnson Amendment” has served as an effective barrier to keep America’s charities, including churches and synagogues, from either endorsing politicians or funding political campaigns. The prohibition is absolute and the penalty severe: revocation of the organization’s tax-exempt status and disallowance of tax-deductible charitable contributions for donors.
Repeal of Campaign Prohibition: For many years, certain segments of the charitable sector, particularly conservative churches and related institutions, have argued that the campaign prohibition infringes upon their freedom of speech, as well as freedom of religion. For many of the past election cycles, various pastors and others have organized an annual “Pulpit Freedom Sunday” during which explicitly political sermons are delivered, challenging the authority of the Internal Revenue Service to revoke their tax status. During the most recent Presidential campaign, candidate Donald Trump pledged to repeal the Johnson Amendment. He followed up on that promise at the 2017 National Prayer Breakfast by affirming his intent to “get rid of and totally destroy the Johnson Amendment and allow our representatives of faith to speak freely and without fear of retribution” from the IRS. He subsequently signed an Executive Order on May 4, 2017 vowing not to enforce the Johnson Amendment, but this EO has had little actual legal impact.
Two Legislative Proposals: Already in the 115th Congress two alternative measures were introduced to either totally or significantly rollback the existing campaign prohibition. The first alternative, total repeal of the prohibition, is contained in H.R. 172, which was introduced by Representative Walter Jones (R-NC). The second alternative, the so-called “Free Speech Fairness Act,” (H.R. 781), introduced by Representatives Steve Scalise (R-LA) and Jody Hice (R-GA) and S. 264 by Senator James Lankford (R-OK), takes a more limited approach. This legislation would permit a charity to speak out for or against a political candidate if such speech occurs in the organization’s regular and customary activities in carrying out its tax-exempt purpose and any expenditure related to such speech is a de minimis incremental expense.
We believe that both of these bills are unhealthy for the charitable sector and for our country. Repeal runs the risk of placing charities on either side of the political divide, potentially creating Democratic or Republican charities. In a time when our political climate is already so toxic, do we really want to create red or blue charities that could add to the public discord, or to create schisms within our organizations that would lessen our effectiveness in communities?
Charities give up profits, privacy, and politics in order to pursue their mission in the context of our current tax system. We oppose any attempts to risk losing such a vital independent voice that is critical to the health of our democracy.
The Asks: Please reach out to your Senators and Representatives to urge them to retain the “Johnson Amendment,” the current prohibition against charities participating or intervening in political campaigns on behalf of or in opposition to candidates for public office. Urge them to oppose H.R. 172, H.R. 781, S. 264 and all other free-standing bills or components of tax reform that would undermine the Johnson Amendment.
We would also recommend that your organization sign-on to a sector-wide letter to preserve the current campaign prohibition. JFNA is one of the founding members of this “collaborative initiative,” which is being coordinated by the National Council of Nonprofits, among others. A copy of the sign-on letter and additional information on the issue is at https://www.givevoice.org/.
Please send an email to your Senator and Representatives. Click here for a sample letter. Click here to contact your Senator. Click here to find your Representative. For further information, please contact Steven Woolf, Senior Tax Policy Counsel at (202) 736 –5863 or email@example.com.