April 2018 Church & State Magazine | People & Events

Focus on the Family, the Religious Right organization founded by child psychologist James Dobson, has begun to call itself a church – a move that could allow it to avoid filing public tax documents with the IRS.

As reported in late February by People For the American Way’s “Right Wing Watch” blog, Focus on the Family last fall posted on its website a 2015 tax form that declared its charity status as a “church, convention of churches or association of churches.”

In an “explanation of church status,” Focus on the Family stated that the IRS informed the organization that it’s no longer required to file tax information about the group’s $89 million budget. Instead, the group said it would make limited financial information available to donors on its website. 

The IRS requires most nonprofits to file an annual Form 990, which outlines an organization’s revenue and expenses and provides transparency on how tax-exempt nonprofits fulfill their missions. Houses of worship and other religious institutions are exempt from the Form 990 requirement; they do not have to file the form or make their records public. The exemption has been couched as a church-state separation protection that prevents the government from getting overly entangled with a religious entity’s operations.

Gail Harmon, an attorney who has advised nonprofits on tax law for more than 30 years, told “Right Wing Watch” she was shocked by Focus on the Family’s claim to be exempt from the Form 990 filing requirement.

“There’s nothing about them that meets the traditional definition of what a church is,” Harmon said. “They don’t have a congregation, they don’t have the rites of various parts of a person’s life. There’s a whole system for what a church is.”

“Right Wing Watch” theorized Focus on the Family could be seeking to take advantage of several other potential benefits by calling itself a church. It is one of the groups advocating for the repeal or weakening of the Johnson Amendment, the federal law that protects the integrity of our elections and nonprofits (including houses of worship) by ensuring they don’t endorse or oppose political candidates and get embroiled in partisan politics. Since some legislative proposals would allow churches but not other nonprofits to engage in electioneering, Focus on the Family as a church would be poised to take advantage of such a change in the law.

As a church, Focus on the Family also might find it easier to get around laws that prevent most organizations from discriminating against LGBTQ people, women, religious minorities and others. A church also is exempt from the Affordable Care Act requirement that most employers provide access to birth control in employee health insurance plans. And Samuel Brunson, a tax law expert at the Loyola University Chicago School of Law, noted that churches are largely shielded from IRS audits because doing so typically requires approval from a “high-level Treasury (Department) official.”