IRS Enters into Consent Decree Limiting Application of Johnson Amendment; New Position Allows Churches to Endorse Candidates in Certain Situations
By: William M. Klimon, Patrick Sternal, Palmer Williams, Rebecca Layne, and Esther Nies
On July 7, 2025, in National Religious Broadcasters, et al. v. Billy Long, Commissioner of the Internal Revenue Services, et al., Docket no: 6:24-cv-00311-JCB (E.D. Texas) (“NRB”), the IRS entered into a consent decree in which it agreed that the Johnson Amendment, which has long conditioned section 501(c)(3) tax exempt status on refraining from partisan political activity, cannot be applied to churches and other houses of worship in certain specific circumstances.
Background
The Johnson Amendment is the portion of Internal Revenue Code section 501(c)(3) that requires charities, including churches, to refrain from endorsing or opposing candidates for public office as a condition of their tax-exempt status. The statute provides that such organizations may not “participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.” The amendment was sponsored by then-Senator Lyndon Johnson and became law in 1954. Since then, churches and religious organizations have been unable to endorse or support candidates for political office without risking the loss of their tax-exempt status.
NRB
In NRB, the plaintiffs, a group of conservative religious organizations, argued that the Johnson amendment violated their First Amendment rights to freedom of speech and free exercise of religion, as well as due process, equal protection, and certain statutory rights, and asked the court to enjoin the IRS from enforcing the Johnson Amendment.
In the consent decree, which would settle the litigation, the IRS agreed that the Johnson Amendment, “as properly interpreted” does not prevent a “house of worship” from speaking “to its congregation, through customary channels of communication on matters of faith in connection with religious services, concerning electoral politics viewed through the lens of religious faith.”
What It Means
Although it appears to have been IRS practice for many years not to enforce the Johnson Amendment “against houses of worship for speech concerning electoral politics in the context of worship services,” the IRS has never before publicly agreed not to enforce the Johnson Amendment, nor has it issued any formal written guidance suggesting that the Johnson Amendment may run afoul of the Constitution. Thus, the IRS’s agreement to the language in the consent decree is a significant and consequential concession.
Religious organizations may now consider scenarios where they communicate which candidates they endorse and urge their congregations to vote accordingly. Of course, these scenarios must be evaluated in light of the language in the consent decree, namely that the communications must occur through customary channels of communication, in connection with religious services, and through the lens of religious faith. But the fact that the IRS has sanctioned a path through which tax-exempt religious organizations may make electoral communications is a departure from longstanding past practice.
Additionally, it is important to note that the IRS’s acquiescence in NRB is limited. Technically, the consent decree in NRB applies only to the plaintiffs in the case, although the IRS will likely apply the same rule to all similarly situated organizations. Still, the IRS has not issued formal administrative guidance stating its position and intention not to enforce the Johnson Amendment in the described circumstances. In addition, the consent decree is limited in scope and is not a license for religious organizations to begin functioning as campaign operations. Rather, the new exemption applies only if the plaintiffs engage in the speech specifically described by the IRS— namely, speech delivered through customary channels to congregations on matters of faith, in connection with religious services, that concerns electoral politics viewed through the lens of religious faith.
Despite these limitations, the consent decree in NRB marks a significant change for the IRS and for the rights of religious organizations. Given the novelty and specificity of the IRS’s position, we recommend that churches, synagogues, and other religious organizations consult with counsel before breaching the wall that the Johnson Amendment had erected. Please reach out to Holtzman Vogel as you consider how this new opportunity applies to your organization.
