Talking Tax Trump Administration Signals Changing Standards for Tax-Exempts
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Jul 23, 2025 The Trump administration is shaking up the landscape for tax-exempt organizations, especially churches, by allowing more political advocacy without risking their status. There's a spotlight on Harvard and threats to its tax-exempt status amid accusations of bias, while colleges scramble to adjust admissions policies to avoid scrutiny. Experts discuss the delicate balance the IRS must maintain between safeguarding free speech and preventing misuse of charitable statuses. Concerns about the ethical implications of IRS powers add another layer to this heated conversation.
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Johnson Amendment Reinterpretation
- The IRS's reinterpretation of the Johnson Amendment allows pastors to speak politically within religious context without losing tax-exempt status.
- Churches are likely to push these boundaries, prompting a need for clear IRS guidance or Congressional legislation.
Call for Regulation Clarity
- The IRS or Treasury should issue clear regulations through notice and comment to define political speech boundaries for churches.
- Alternatively, Congress could enact legislation to clarify the limits of the Johnson Amendment.
Limits on White House Power
- The White House cannot legally revoke tax-exempt status or order IRS audits directly against organizations like Harvard.
- IRS regulatory projects with public comment periods could change how universities engaging in DEI practices are treated.