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The Internal Revenue Service altered its opinion July 7 and granted tax-exempt status to the group. More information can be found at The Christian Post.
The Internal Revenue Service recently denied tax-exempt status to a Texas religious organization that seeks to pray for America’s leaders and encourage people to vote on grounds the group exists to help the Republican Party, The Epoch Times reported.
“Specifically, 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,” wrote Stephen A. Martin, director of the IRS Office of Exempt Organizations Rulings and Agreements.
Martin sent the letter May 18 to Christians Engaged, a Garland, Texas-based prayer group recognized by Texas officials as being tax-exempt.
“The Bible teachings are typically affiliated with the D party and candidates. This disqualifies you from exemption under lRS Section 50I(c)(3),” Martin said.
Apparently, the “D party” is a reference to Republicans, according to an IRS-provided legend.
The action resurrected charges the IRS was once again being used to target conservatives and Christian organizations under a Democrat administration.
“The act of praying for our country and our leaders is about the most nonpartisan and patriotic thing that Americans can do. Millions of citizens do it every day,” Rep. Ted Budd (R-N.C.) told The Epoch Times on June 16.
The full story can be read at The Epoch Times.
In some ways, the hassle to qualify as a charitable organization under the Internal Revenue Code doesn’t make sense from a financial standpoint. Without the designation, the groups would be taxed like any business, but only on money earned after paying for all typical business expenses, including rent, salaries, utilities, insurance, supplies, advertising, equipment, etc.
An effective charity run as a business could spend almost all of its income on legitimate expenses, thus showing a very small taxable profit.
However, the biggest incentive to attain 501(c)(3) designation is that it attracts large donations from people capable of contributing more than $12,700 per year so they can deduct it from their taxes.
The Trump administration raised the standard tax deduction from $5,300 to $12,700 per year, thus making the deduction beneficial only to people spending more than that amount on charitable donations, home interest or medical expenses.
In states like Arizona, where I live, donating to some recognized charities actually works as a tax credit. That means if someone donates $600 to a certain type of charity, he or she can deduct $600 from taxes owed, not just their taxable income.
It’s much better to give $600 to a charity than it is to the government.
That’s why attaining official designation as a charitable organization is so important. When government prolongs applications or refuses to grant official certification, it can work to starve a group of cash donations.
First Liberty Institute is representing the charity in appealing the IRS ruling.