After the Supreme Court’s decision on gay marriage, religious leaders feared that religious universities, nonprofits and other institutions could lose their tax-exempt status. IRS Commissioner John Koskinen has promised the Senate Judiciary Oversight Subcommittee that his agency would not go after the tax-exempt status of religious colleges and universities that oppose gay marriage.
During a hearing Wednesday conducted by the Senate Subcommittee on Oversight, Agency Action, Federal Rights and Federal Courts, Sen. Mike Lee (R-Utah) asked Koskinen whether the IRS would “not, in the absence of a directive by Congress or by the courts,” take action to remove religious schools’ tax exemption.
“I can make that commitment,” Koskinen said, explaining that “we see no basis for changing our examination criteria as a result of this Supreme Court case.”
Koskinen discussed the potential for such schools’ tax exemption to go under scrutiny down the road. “If we ever did that, we would issue it for public comment. There would be no surprises,” Koskinen said. “The public would have plenty of notice and plenty of opportunity to comment, and that’s not going to happen in the next two and a half years.”
Lee pointed to the Supreme Court’s oral arguments in March, when Justice Samuel A. Alito Jr. compared the case to one involving Bob Jones University, a fundamentalist Christian college in South Carolina. The Supreme Court ruled in 1983 that the school was not entitled to a tax-exempt status if it banned interracial marriage.
Solicitor General Donald B. Verrilli Jr., arguing for same-sex couples, agreed that tax-exempt status is “certainly going to be an issue.” That set off fears among religious leaders that their tax-exempt status could be questioned. Chief Justice John G. Roberts Jr. wrote for the minority that the issue will eventually come before the court.
“The majority graciously suggests that religious believers may continue to ‘advocate’ and ‘teach’ their views of marriage,” Roberts wrote. “The First Amendment guarantees, however, the freedom to ‘exercise’ religion. Ominously, that is not a word the majority uses.”
Koskinen’s comments seemed to leave open the door that tax-exempt status could come under scrutiny in the future.
“At this time there is no basis for us to revisit tax-exempt status on that grounds. We will continue, obviously, to ensure that those who enjoy tax-exempt status are still doing the work they said they were going to do,” Koskinen said. “But that exam and those reviews will continue as they always have.”
Lee, who has introduced an act regarding institutions’ tax-exempt status, warned that the IRS promise could be temporary.
“While I greatly appreciate Commissioner Koskinen’s word that he will not target religious institutions for their religious beliefs, it worries me, and it should worry every American, that the IRS does not absolutely disavow the power to target religious institutions based on their religious beliefs, even if the current IRS commissioner has committed not to use that power for the time being,” Lee said in a statement after the hearing.