Taxable Talk

Normally when we talk about smelling flowers we’ll use a line like, “Waking up and smelling like roses.”  But that is decidedly not the case with this story, so we chose a different plant: Crown Imperial (Fritillaria imperialis).  You’ll see why shortly.

Back on June 20th we reported on the IRS denying 501(c)(3) status to Christians Engaged.  The reason given hearkened back to the IRS Scandal on non-profits:

[Y]ou are serving the private interests of the D party [D means Republican] more than incidentally in contravention to Treas. Reg. Section 1.501(c)(3)-1(d)1(ii) as well as serving a substantial nonexempt private purpose. For example, you educate Christians on what the bible says in areas where they can be instrumental including the areas of sanctity of life, the definition of marriage, biblical justice, freedom of speech, defense, and borders and immigration, U.S. and Israel relations. The bible teachings are typically affiliated with the D party [Republican] and candidates. This disqualifies you from exemption under IRC Section 501(c)(3).

Well, it appears the IRS got the message.  Christians Engaged received a new IRS Letter dated today that states: “We’re pleased to tell you we determined you’re exempt from federal income tax under Internal Revenue Code (IRC) Section 501(c)(3).”  There was no explanation given why the denial was reversed, but a cynic–and I am definitely one on this issue–believes the IRS figured out that only bad things would happen if the denial were to stand.  Indeed, under President Biden’s proposed budget the IRS is looking at an $80 billion increase in funding.  I strongly suspect IRS management realized that funding was in grave danger if the IRS continued to publicly discriminate against conservative (and religious based) nonprofits.

So does the IRS come up smelling like roses?  Hardly.  The IRS didn’t explain why Christians Engaged didn’t receive 501(c)(3) status to begin with.  Had I formed a new charity (and complied with all the minutiae regarding 501(c)(3) organizations) titled, “Ultra Liberals Engaged,” does anyone think that I wouldn’t have quickly received approval?

So the IRS comes up smelling like the Crown Imperial plant.  You haven’t heard of this plant?  It’s “a dazzling and unique member of the Lily family…In addition to adding visual interest, these flowers…have a potent, musky scent almost like a skunk….”

Hat Tip: Tyler O’Neil

Most of us remember the IRS scandal from 2013.  In that scandal we learned that the IRS and/or individuals working at the IRS deliberately targeted conservative tax exempt (nonprofit) organizations.  It was a huge scandal at the time, and it led directly to the IRS’s budget being cut.  It’s now eight years later, and one would assume the IRS had learned.

One would be wrong.

From various sources we learn that the IRS has denied 501(c)(3) status to a group titled Christians Engaged.  Why? Quoting from the actual letter denying 501(c)(3) status:

[Y]ou are serving the private interests of the D party [D means Republican] more than incidentally in contravention to Treas. Reg. Section 1.501(c)(3)-1(d)1(ii) as well as serving a substantial nonexempt private purpose. For example, you educate Christians on what the bible says in areas where they can be instrumental including the areas of sanctity of life, the definition of marriage, biblical justice, freedom of speech, defense, and borders and immigration, U.S. and Israel relations. The bible teachings are typically affiliated with the D party [Republican] and candidates. This disqualifies you from exemption under IRC Section 501(c)(3).

This is, bluntly, unbelievable.  President Biden, a Democrat, is a practicing Catholic who presumably believes in the Bible.  If we believe this letter, only Republicans believe in the sanctity of life, marriage, freedom of speech, defense, and US-Israel relations.   I guess if the IRS says its true we must now all vote Republican, because apparently God is a Republican.

A 501(c)(3) charity does need a charitable purpose.  According to the President of Christians Engaged, Bunni Pounds, they, “…[W]ant to encourage more people to vote and participate in the political process.  How can anyone be against that?”  It appears that for at least a few individuals at the IRS (the employee who wrote this letter and his supervisor), having more Christians engaged in the political process is a bad thing.

I do expect IRS Appeals to overrule the tax exempt group.  I also hope that there is some additional remedial training for that group because it sure looks like they haven’t learned a thing in eight years.