Since the IRS code was amended in 1954 to include “churches” as 501(c)(3) “tax exempt” corporations, only one church has lost its tax-exempt status for violating the IRS code.  Unfortunately, that statistic may be about to increase drastically due to the Supreme Court ruling on gay marriage.

Thanks to the efforts of Texas Democrat senator Lyndon B. Johnson in 1954, almost every church in America today is registered under the 501(c)(3) IRS code.  Johnson promoted the amendment to change the IRS code as what he called a “favor” to churches, but a closer look at history reveals that his ulterior motive was to encourage churches to “formally” register with the IRS for mostly political reasons.  It seems the real reason Johnson wanted to have churches under the control of the IRS was because he believed they were gaining too much political power through their influence from the pulpit over millions of registered voters.  In essence, Johnson wanted to legally silence churches by having them relinquish their constitutional rights under the First Amendment by becoming legal corporate entities subject to the dictates of the State and enforced by the IRS.

Based on last week’s gay marriage ruling by the Supreme Court, churches registered as 501(c)(3) corporations may find Johnson’s efforts less of a “favor” and more of a catastrophe.

While most church leaders ignorantly believe that their “churches” have some sort of protected constitutional rights, as registered 501(c)(3) corporations, they actually have none.  When churches register with the State as 501(c)(3) corporations, they relinquish all “personal” constitutional rights and are governed totally by the dictates of the IRS law through what is known as an “artificial person.”  And since this artificial person is created solely by the power of the State, all churches’ rights, along with their existence, are subject to and limited by the dictates of the 501(c)(3) IRS code – not the Constitution.

Since the SCOTUS ruling on gay marriage, there has been much talk and alarm about churches losing their tax-exempt status.  And because most churches have voluntarily decided since 1954 to become “unequally yoked” with the State, their fears are well founded.  With regard to the State’s power over churches in the matter of upholding Supreme Court Rulings under federal law, what Caesar giveth – Caesar can take away!

Regardless of why churches choose to register with the IRS as tax-exempt corporations, based on the following excerpt from one study, under the new court ruling on gay marriage, 501(c)(3) churches are now stuck between a rock and a hard place:

By incorporating, the pastor and elders of a church need to realize that they have, in effect, signed a contract with the federal government which they have become legally and morally liable to obey. They cease to exist as a "real" person under the First Amendment with "unalienable" rights, and are transformed into a federal institution under the complete jurisdiction and control of "Acts of Congress." A church can no more change the nature of a contract after the fact than a private individual.” Ecclesia.org

"As a general proposition, a party is held to what he signs.... One cannot obtain a release from contract liability upon the ground that he did not understand the legal effect of the contract" Len Young Smith and G. Gale Roberson, Smith and Roberson's Business Law, p. 70

Most church leaders believe they are obligated by law to register with the IRS to get their tax-exempt status, but the First Amendment clearly dictates that there has never been any need for churches to formally register with the IRS – neither before the First Amendment’s adoption in 1791 nor since the 1954 IRS law change.

Churches have always been tax-exempt since the First Amendment was enacted.  This excerpt from another study lays out the facts:

“Does the law require, or even encourage, a church to organize as a 501c3? To answer that question let's turn to what the IRS itself has to say. Churches Need Not Apply.

In order to be considered for tax-exempt status by the IRS an organization must fill out and submit IRS Form 1023 and 1024. However, note what the IRS says regarding churches and church ministries, in Publication 557:

  Some organizations are NOT required to file Form 1023. These include:

“Churches, interchurch organizations of local units of a church, conventions or associations of churches, or integrated auxiliaries of a church, such as a men’s or women’s organization, religious school, mission society, or youth group. These organizations are exempt automatically if they meet the requirements of section 501(c)(3).

Churches Are “Automatically Tax-Exempt”

According to IRS Code § 508(c)(1)(A):

  Special rules with respect to section 501(c)(3) organizations.

(a) New organizations must notify secretary that they are applying for recognition of section 501(c)(3) status.

  (c) Exceptions.

  (1) Mandatory exceptions. Subsections (a) and (b) shall NOT apply to—

  (A) Churches, their integrated auxiliaries, and conventions or associations of churches.

This is referred to as the "mandatory exception" rule. Thus, we see from the IRS’ own publications, and the tax code, that it is completely unnecessary for any church to apply for tax-exempt status. In the IRS’ own words a church “is automatically tax-exempt.”

Churches Are “Automatically Tax-Deductible”

So what about tax-deductibility? Doesn’t a church still need to become a 501c3 so that contributions to it can be taken as a tax deduction? The answer is no! According to IRS Publication 526:

  Organizations That Qualify To Receive Deductible Contributions

You can deduct your contributions only if you make them to a qualified organization. To become a qualified organization, most organizations other than churches and governments, as described below, must apply to the IRS.

In the IRS’ own words a church “is automatically tax-deductible.”

The government has shown since 1954 to be very lenient in its assessment of what could be considered violations of the IRS law, but Friday’s Supreme Court ruling on gay marriage, along with a highly volatile liberal social climate in America, may lead liberal activists to demand that the government begin scrutinizing more closely the actions and speech of churches regarding gay rights.” Hushmoney.com

The bottom line for corporate churches is this: if a church is registered with the IRS under the 501(c)(3) code, then whatever happens now is completely “on them.”  In essence, the church has no one to blame but itself for the mess it is in now.

Fortunately for churches that are not formally registered with the IRS, they can continue operating without any fear of government or IRS retribution.  (Notwithstanding the forthcoming liberal social persecution, which will be quite intense.)  Not being registered as a 501(c)(3) renders the IRS impotent, leaving the State with no legal mechanism or right to revoke a church’s guaranteed First Amendment tax-exempt status.

In conclusion, if there is any notion that this court ruling is the “end-game” for the liberal gay agenda, think again.  President Obama sent this tweet out after the court ruling.

“Today is a big step in our march toward equality. Gay and lesbian couples now have the right to marry, just like anyone else.” President Barack Obama/Twitter

Note that President Obama did not say today was the “final” step; which means the march will continue for the LGBT movement.  So are churches the “next” big step in the liberal march toward equality?

Surely in some Democrat political back room, someone is saying he wishes LBJ were here to see this.