Our group is proposing a resolution to instate a corporate income tax on churches and other

religious organizations in the United States. Currently, the Internal Revenue Code section 501(c)(3)
exempts religious organizations from federal income tax, due to their unique status in American society
and of their rights guaranteed by the First Amendment of the Constitution of the United States (Internal
Revenue Service 2). Exempting religious organizations from federal income tax costs our country $71
billion a year (Mehta 1), but since Walz v. Tax Commission of the City of New York (1970) the
exemption has been ruled constitutional. Churches are treated favorably under the current tax code, and
unlike unaffiliated non-profits, are not required to fill out a 990 form (Tax the Churches). These forms
were specifically created to check up on tax exempt organizations to make sure they meet the criteria and
are not committing fraud, yet religious organizations are exempt from this as well. This favorable
treatment is wrong and goes against the Establishment Clause of the First Amendment of the United
States Constitution by establishing religion via tax exemption. Our bill will make sure that religious
organizations arent treated any differently than other non-profits.
Our bill has two distinct parts. The first part would instate a federal income tax on religious
organizations. Churches are treated as non-profits with even more favoritism, while they really shouldnt
be considered non-profits at all: On average, 71% of church income is spent on expenditures. Compare
that to the American Red Cross at 7.9% (Cragun, Yaeger, Vega 1). However, if a church could meet the
IRC standard for a non-religious non-profit for charity, then we would allow for tax exemption like any
other non-profit. The second part of our bill would require churches to fill out the 990 forms that they are
exempt from. The IRS would then have official documentation on financial activities by religious
organizations, which is very important in preventing fraud and making sure tax-exempt churches meet
charity standards.
People opposing our resolution may point towards the Free Exercise Clause of the First
Amendment to the Constitution, which states Congress shall make no law prohibiting the free exercise
of [religion]. Due to a newly placed tax burden on religious organizations, many critics would claim
their free exercise of religion is limited. However, this is not the case. There is a part before the Free
Exercise Clause known as the Establishment Clause, as mentioned in the introductory paragraph. This
clause prohibits Congress from establishing religion, and treating religious organizations differently than
other charities and non-profits definitely violates the Establishment Clause. You can still go to any church
you wish as normal, therefore the Free Exercise Clause is not violated. The only Constitutionality issue
here is regarding the current IRC and its religious favoritism. Other critics may argue that religion is very
beneficial to society, and again, this bill will not cause any religion to die out.
How is it that a megachurch that receives thousands of dollars in donation and barely donates
much at all is favored over a charity organization that donates almost all of its income to its cause? This
directly violates the Establishment Clause. Walz v. Tax Commission of the City of New York has said
otherwise, but that doesnt mean our cause is less relevant or important. The federal government loses
$35.3 billion annually because of this religious favoritism (Cragun, Yaeger, Vega 2). This bill would
finally end this corrupt system and move America closer to the country the Founding Fathers dreamed of.

"Tax the Churches." Tax the Churches. N.p., n.d. Web. 17 Oct. 2013.

<http://taxthechurches.org/>.
Cragun, Ryan T., Stephanie Yaeger, and Desmond Vega. "Council for Secular
Humanism."Council for Secular Humanism. N.p., 18 Oct. 2013. Web. 17 Oct. 2013.
<http://www.secularhumanism.org/index.php?section=fi>.
"The Yearly Cost of Religious Tax Exemptions: $71,000,000,000." Friendly Atheist. N.p., 6 June
2012. Web. 17 Oct. 2013. <http://www.patheos.com/blogs/friendlyatheist/2012/06/16/theyearly-cost-of-religious-tax-exemptions-71000000000/>.
"Tax Guide for Churches and Religious Organizations." IRS Tax Guide. Internal Revenue
Service, n.d. Web. 15 Oct. 2013.
<http://www.irs.gov/pub/irs-pdf/p1828.pdf>.