https://wildhunt.org/2025/07/irs-settlement-reinterprets-johnson-amendment-allowing-churches-to-endorse-political-candidates.html

IRS Settlement Reinterprets Johnson Amendment – Allowing Churches to Endorse Political Candidates
Manny Moreno By Manny Moreno

WASHINGTON- In a significant development and break from history, the Internal Revenue Service (IRS) announced on July 7, 2025, that it would no longer enforce restrictions of the Johnson Amendment against churches that engage in political speech during religious services. This reinterpretation came as part of a legal settlement with the National Religious Broadcasters (NRB), Intercessors for America, and two Texas churches—Sand Springs Church and First Baptist Church of Waskom—who had sued the agency in federal court.

The lawsuit challenged the constitutionality of the Johnson Amendment, a provision in the tax code since 1954 that prohibits 501(c)(3) nonprofit organizations—including religious institutions—from endorsing or opposing political candidates if they wish to maintain their tax-exempt status. The plaintiffs claimed the rule infringed upon their First Amendment rights to free speech and religious expression, as well as protections under the Religious Freedom Restoration Act and the Fifth Amendment.

The legal filing, submitted to the U.S. District Court for the Eastern District of Texas, seeks court approval for a “consent judgment” that would formalize a shared interpretation between the plaintiffs and the IRS: that internal church communications during worship services about political matters, when framed through the lens of religious faith, do not constitute political campaigning under the Johnson Amendment. This interpretation is consistent with the IRS’s historical lack of enforcement against religious speech in worship settings.

The IRS and the religious groups agreed that when a church talks to its members during services about political matters from a faith-based perspective, it should not be considered “participating in” or “intervening in” a political campaign. In practice, the IRS has generally not enforced the Johnson Amendment against churches for this kind of speech, and both sides agreed to make that understanding legally binding through this court order.

As part of the deal, the IRS agreed not to enforce the Johnson Amendment against the two plaintiff churches under these specific circumstances. In return, the plaintiffs agreed to drop all remaining claims in the lawsuit and not seek further legal action. Both sides also agreed not to appeal the decision and to pay their own legal costs.

This filing seeks the court’s official approval of the settlement, which would close the case and give the churches legal protection to continue faith-based political discussions within their congregations without fear of losing their tax-exempt status.

The agreement would prevent the IRS from penalizing the plaintiff churches for political speech made in connection with religious services. In exchange, the plaintiffs would drop all outstanding claims, waive their right to appeal, and cover their own legal costs.

“The Founders envisioned a Nation in which religious voices and views were integral to a vibrant public square,” the filing states, quoting a 2017 executive order signed by then-President Donald Trump. The document further argues that enforcing the Johnson Amendment against churches for faith-based political commentary risks favoring some religions over others—a potential violation of the Constitution’s Establishment Clause.

While the plaintiffs celebrated the move as a victory for religious liberty, critics saw the settlement as a dangerous precedent.

Rachel Laser, President and CEO of Americans United for Separation of Church and State, condemned the reinterpretation as “a brazen attack on church-state separation that threatens our democracy by favoring houses of worship over other nonprofits and inserting them into partisan politics.”

She continued: “The Trump administration’s radical reinterpretation of the Johnson Amendment is President Trump and his Christian Nationalist allies’ signature move: exploiting religion to boost their own political power” (Americans United, July 2025).

Laser emphasized that the law has protected the integrity of both religious institutions and elections for over 70 years. “Weakening this law would undermine houses of worship and nonprofits by transforming them into political action committees, flooding our elections with even more dark money,” she warned. “Polls have repeatedly shown that a broad cross-section of Americans – including faith leaders, evangelical Christians and Republicans – don’t want houses of worship to endorse or oppose political candidates.”

When Trump previously threatened the Johnson Amendment during his first term, more than 4,600 faith leaders, 5,800 nonprofit organizations, and 106 religious groups voiced strong opposition. Laser called on the court to reject what she described as an unconstitutional “gambit to re-write the law through the judicial system.”

Concerns about the implications of the IRS’s move extended beyond church-state advocates. Jeff Clements, CEO of American Promise, a nonpartisan group advocating for campaign finance reform, argued the change should not be made through agency policy or court settlement.

“Whether tax-exempt nonprofits should endorse political candidates is a question for Congress—not the IRS or the courts,” Clements said in a statement to POLITICO. “The Johnson Amendment has been the law since 1954. If it’s going to change, it should be through open debate by elected lawmakers—not backdoor legal deals. Undermining it risks more dark money, less transparency, and even greater erosion of public trust in both our elections and our charities.”

The consent judgment now awaits approval by the court. If granted, it would only apply to the named plaintiff churches but could pave the way for similar reinterpretations nationwide—potentially altering the long-standing boundaries between tax-exempt religious activity and partisan political engagement.