Veiled Leviathan: Protecting Citizens from the Church Financial Reporting
Exception
by Adam L. Wilson
Table of Contents
I. INTRODUCTION............................................................................................................................ 1
II. FLEECING THE FLOCK: THE CHURCH REPORTING EXCEPTION TODAY ................................ 4
A. THE CHURCH AS A TAX EXEMPT ORGANIZATION .................................................................... 4
B. REPORTING EXCEPTIONS .......................................................................................................... 8
C. AUDITING RESTRICTIONS ......................................................................................................... 9
III. A BRICK IN THE WALL? REFUTING FIRST AMENDMENT ARGUMENTS FOR MINIMAL
OVERSIGHT ................................................................................................................................... 11
A. THE WALZ DECISION ............................................................................................................. 11
B. BEYOND WALZ ...................................................................................................................... 14
IV. GENESIS: THE ORIGINS OF THE CHURCH REPORTING EXCEPTION IN AMERICA................ 16
A. BY GRACE ALONE: EARLY HISTORY OF CHURCH TAX EXEMPTION ....................................... 16
B. A PLACE IN THE CODE: TWENTIETH-CENTURY CHURCH TAX EXEMPTION ............................. 19
V. LEVIATHAN: MEGA-CHURCHES AND ABUSE OF THE REPORTING EXCEPTION ..................... 21
VI. LIGHT IN THE WILDERNESS: THE GOVERNMENT’S ROLE AS PROTECTOR ......................... 26
VII. CONCLUSION ......................................................................................................................... 27
I. INTRODUCTION
The legitimate powers of government extend to such acts only as are injurious to others.
But it does me no injury for my neighbor to say there are twenty gods, or no God. It
neither picks my pocket nor breaks my leg. – Thomas Jefferson1
Thomas Jefferson has often been quoted when a party seeks to invoke the “wall of
separation” protecting churches from interference from the State. This line of thinking, more
often than not, fails to consider the State’s role in protecting its citizens. What is the
government’s role when a church is seemingly “picking the pockets” of its citizen-parishioners,
who sometimes number in the thousands? What if that pilfering is done under the guise of
1
soliciting charitable contributions, which are then diverted, without oversight, to the pockets of
church leaders? What if the money collected is exempt from federal taxes, with no requirement
to report that it was collected, or that the organization collecting it even exists?
This is not a what-if scenario. This is the current state of Internal Revenue Code §
501(c)(3) as it applies to churches. A stunning lack of any effective financial accountability
requirements for churches has essentially created a two-headed monster, potentially harming the
taxpayer in two distinct fashions – through diverting intended charitable contributions to the
inurement of other individuals, and denying deduction of those contributions should it be later
determined the church in question was not exempt. While not all churches, and not even a
majority of churches, abuse the system by diverting funds for private inurement, holding
churches to the 501(c)(3) reporting standards of other public foundations could help remedy any
abuses where they exist, and prevent such abuses in the future.
The topic of State-subsidized,2 unaccounted, private inurement in the form of so-called
churches is not new and has been examined previously in detail.3 In 1991, one scholar concluded
“It is detrimental both to the public and to religion to allow any organization to escape financial
accountability in the name of religion.”4 Seventeen years have passed since that forceful
1
THOMAS JEFFERSON, NOTES ON THE STATE OF VIRGINIA 285 (Merrill D. Peterson ed., Library of
America, Literary Classics of the United States 1984) (1784).
2 While the Court in Walz v. Tax Commissioner held that exemption was merely a failure to collect tax and
not subsidy of religion, See Walz, 397 U.S. 664, 680 (1970), later decisions have referenced similar
exemptions and deductions as a subsidy. See Taxation With Representation v. Regan, 461 U.S. 540, 54
(1983) (“Both tax exemptions and tax deductions are a form of subsidy”).
3
See Reka Potgeiter Hoff, The Financial Accountability of Churches for Federal Income Tax Purposes:
Establishment or Free Exercise? 11 VA. TAX REV. 71(Summer 1991).
4 Id. at 136.
2
declaration and despite the contemporaneous wave of church financial scandals surrounding it,5 a
glaring lack of reporting accountability by churches continues.6
Most debate over reporting exceptions for churches centers on whether or not the
government can or should hold churches financially accountable in the same manner as other
public non-profit organizations.7 An examination of history and the law finds that the church tax
exemption and its attendant reporting exceptions seemingly exist, and have essentially always
existed, solely as a matter of legislative grace.8 In light of continued church financial scandals,
and considering the traditional role of government in ensuring the security of its citizens and their
property, the appropriate question is not “Can the state require financial reporting and
accountability of churches?” The real issue hinges on the duties of the State to protect its
citizens. While smaller churches pose little threat of widespread abuse of citizens and the tax
exempt system, the increasing number of Mega-Churches, with massive donor bases, creates a
pressing problem of potential abuse of the tax exempt system on a grand scale. The appropriate
inquiry is should the State require such financial accountability of these large churches through
reporting in the interest of fulfilling the State’s essential function of protecting the citizenry from
that which would harm them? To that question, the answer is yes.
5
6
See infra Part V, Notes 109 and 110.
See infra Part II.
Jennifer M.Smith, Morse Code, Da Vinci Code, and…Churches: An Historical and
Constitutional Analysis of Why Section 501(c)(3) Does Not Apply to Churches. 23 J.L. & POL. 41
(Winter 2007).
8
See infra Part IV.A. and Part IV.B.
3
7
II. FLEECING THE FLOCK: THE CHURCH REPORTING EXCEPTION TODAY
A. THE CHURCH AS A TAX EXEMPT ORGANIZATION
Internal Revenue Code § 501(c)(3) outlines the basic requirements for
organizations who wish to claim exempt status from federal income taxation.9 Generally, any
organization other than a church seeking tax exempt status must file a Form 1023 determination
of tax exempt status with the Internal Revenue Service (“the Service”).10 The Form 1023
requires information from the requesting organization relating to a series of four tests, used in
determining whether or not the organization qualifies as for tax exempt status. 11 An
organizational test is used to determine if the organization has been organized for one or more
exempt purposes, as defined by 501(c)(3), under its articles of incorporation.12 The operational
test is used to determine whether the organization engages primarily in activities that serve an
exempt purpose under 501(c)(3).13 The third test determines whether the earnings of the
organization, in whole or in part, inure to the benefit of private individuals.14 The private
inurement test is the one most often utilized in examining churches,15 but in all but the most
egregious circumstances will never be applied.16 Finally, the political activities test, is used to
determine whether or not an organization qualifies as a political “action organization”, not
9
I.R.C. 501(c)(3).
I.R.C. 508(a); see infra Part II.B for more on the filing requirement as it applies to churches.
11 Internal Revenue Service, Form 1023, http://www.irs.gov/pub/irs-pdf/f1023.pdf (last visited Oct. 30
2008).
12 Treas. Reg. § 1.501(c)(3)-1(b).
13 Treas. Reg. § 1.501(c)(3)-1(c)(3).
14 Treas. Reg. § 1.501(c)(3)-1(c)(2).
15 See Church of Modern Enlightenment v. Commissioner, 55 T.C.M.(CCH) 1304 (1988); Tony and Susan
Alamo Foundation v. Commissioner, 63 T.C.M.(CCH) 2422 (1992).
16 See infra Parts II.B. and II.C.
10
4
exempt under the code.17 If an organization fails to meet any one of these tests they may be
denied tax exempt status.
However, churches need not file for a preliminary determination to claim tax exempt
status,18 and are automatically considered public foundations,19 allowing contributors to deduct
up to fifty percent of their contribution base as charitable gifts to churches.20 Through this
process churches can avoid application of any of the determination tests, essentially existing on
the periphery of regulated non-profit organizations. Churches are free from scrutiny at inception,
and can remain so with little effort.21 And these are but a few of the special privileges afforded
churches under the Internal Revenue Code (“the Code”).22 Add to that the disturbing fact that
nowhere in the Code is “church” defined, opening the door for any and all to create fully tax
exempt, unregulated, and unmonitored “churches.”
One reason for the fairly open rules regarding churches is that defining a “church” for the
purposes of tax and reporting exemption has proven problematic. Defining what is and is not a
church implicates the Establishment Clause, and leads to state agencies ultimately deciding what
qualifies as an acceptable religion, hearkening back to colonial endorsement of churches and
creating an obviously excessive entanglement of the State in the church. Courts have attempted
17
Treas. Reg. § 1.501(c)(3)-1(c)(3).
I.R.C. § 508(c).
19 I.R.C. § 508(b) (All foundations are considered private, subject to an excise tax and other penalties); see
also I.R.C. § 508(c) (Outlines the short list of exceptions, including churches).
20 I.R.C § 170(b)(1)(A)(i); see also I.R.C. § 170(b)(1)(B)(i) (Gifts to private foundations are deductable
only up to thirty percent of the donor’s contribution base, generally gross income).
21 See infra Part II.B. and II.C.
22 See also I.R.C. § 514(b)(3)(E) (Increased period to classify income from debt financed property, no
neighborhood test); I.R.C. § 6043(b)(1) (Churches need not file returns on dissolution/corporate
liquidation).
18
5
to define “church” through various tests, primarily the Service’s fourteen points test,23 and the
Tax Court’s associational test.24 The associational test seems similar to the Service’s
organizational and operational tests,25 seeking to avoid the issue of religious validity altogether,
preferring to base decisions on other factors.26 With apparently no clear consensus on how a
church should be defined or recognized, perhaps courts could merely apply another First
Amendment “test” of sorts: “I know it when I see it.”27
A real solution to this problem is much simpler. The problem of determining what is and
is not a church could easily be solved by adhering to the substantial regulations of what is and is
not a non-profit organization.28 Accepting that the church tax exemption is a matter of privilege,
granted by Congress,29 a church filing for tax exempt status should qualify for exemption as a
function of its charitable purpose and activities, rather than its mere existence. Churches
exceeding the $25,000 gross proceeds threshold after which filing is required,30 would file for a
determination, as any other aspiring non-profit. This allows the Service to vet their applications
23
Rev. Proc. 91-20, 1991 C.B. 524 § 3 (Criteria including distinct legal existence, recognized creed and
form of worship, definite and distinct ecclesiastical government, and a formal code of doctrine or
discipline).
24 Foundation of Human Understanding v. Commissioner, 88 T.C. 1341, 1358-1360 (1987) (Although the
criteria developed by the IRS are helpful in deciding what is essentially a fact question, whether petitioner
is a church, we do not adopt them as a test).
25 See supra notes 12 and 13.
26 See Founding Church of Scientology v. U.S., 412 F.2d 1197, 1199 (1969) (Court need not determine
whether organization was religious, Church failed to meet statutory conditions for exemption).
27 Jacobellis v. Ohio, 378 U.S. 184, 197 (1964)(J. Stewart concurring) (“I shall not today attempt further to
define the kinds of material I understand to be embraced within that shorthand description; and perhaps I
could never succeed in intelligibly doing so. But I know it when I see it, and the motion picture involved in
this case is not that”).
28 See supra note 26 (Based on the idea that churches are measured against the four tests if ever brought
into court, it is not a stretch to require them to submit to a determination at inception).
29 See supra Parts IV.A. and IV.B. (The assumption that churches function not-for-profit was the original
and traditional impetus for the exemption).
6
against the applicable tests without worrying if the organization really is a “church.” Accepting
this reasoning ensures that courts will never again tread on the treacherous waters of the First
Amendment in relation to church tax exemption. Churches can and should qualify and report as
any other organization does.
While solving the church definition quandary in this manner would seem to resolve the
issue entirely, the current state of the Code assumes churches function not-for-profit.31 This
assumption has much political support, as is evidenced by the longstanding Congressional
exemption of churches from taxation and exception from any reporting requirements. The
assumption that churches function not-for profit favors small churches who cannot afford
accountants or tax professionals,32 and it does have the beneficial effect of possibly preventing
some unnecessary entanglement of church and state.33 But this assumption, and the fact it will
probably remain a part of the Code, guarantees determination issues are merely the tip of the
proverbial iceberg. Automatically assuming any organization claiming to be a church functions
as a public not-for-profit entity creates a loophole for abuse of the tax exempt system with no
oversight from the outset. This allows any abuse to continue for some time before the Service is
made aware of a problem. The problems created by the lack of a preliminary determination are
exacerbated by the lack of reporting requirements after formation of the church and the
difficulties in Service oversight created by auditing restrictions.
30
See I.R.C. § 6033(a)(3) (2009); Treas. Reg. § 1.6033-2(g) (2009). See also Internal Revenue Service,
Filing Requirements, http://www.irs.gov/charities/article/0,,id=96103,00.html (last visited Oct. 30, 2008).
31 This assumption has been held since 1909. See supra Part IV.B.
32 See infra Part III.B. (Small churches could use the exemption held by small non-religious, not-for-profit
corporations).
33 See Walz v. Commisioner, 397 U.S. 664, 674 (1970) (Elimination of the exemption would most likely
create excessive entanglement).
7
B. REPORTING EXCEPTIONS
While the exception of churches from filing a Form 1023 determination34 and the
attendant issue of churches existing and collecting tax deductible donations without any
knowledge of the Service is troubling, many churches do file for a determination to ensure donor
contributions will be tax deductible.35 Even if a church receives a favorable determination,
becoming a recognized 501(c)(3) organization, oversight by the Service is minimal at best. Most
tax exempt organizations with gross receipts over $25,00036 are required to file informational
returns with the Service, however churches top the short list of organizations mandatorily
exempted from this reporting.37
Organizations that do not qualify for a reporting exception, namely any organization that
has gross proceeds over $25,000, or is not a church, must file an informational return: a Form
990.38 Form 990, the reporting tool used by the Service in examining tax exempt entities,
recently underwent a large revision for the 2008 tax year.39 The new form consists of eleven
pages, and those forms which apply to the organization from the sixteen reporting schedules.40
The schedules require accounting and employee information based on the type of reporting
34
I.R.C. § 508(a).
is the donor’s responsibility to ensure charitable contributions are given to a qualifying charity and
therefore deductable. See I.R.C. § 6115(a) (Donees required to give written receipts of gifts over $75);
I.R.C. § 170(f)(8)(A)( Donor may not deduct without written, contemporaneous acknowledgement from
qualifying charity, substantiating the donation).
36 See I.R.C. § 6033(a)(3); Treas. Reg. § 1.6033-2(g). See also Internal Revenue Service, Filing
Requirements, http://www.irs.gov/charities/article/0,,id=96103,00.html (last visited Oct. 30, 2008).
37 See I.R.C. § 6033(a)(3)(A)(i). Additionally, at the discretion of the director, other public organizations
can be deemed exempt from reporting. See I.R.C. § 6033(a)(3)(B).
38 I.R.C. § 6033.
39Internal Revenue Service, IRS Completed 2008 Form 990 Instructions and Background Documents,
Updated August 19, 2008, http://www.irs.gov/charities/article/0,,id=181089,00.html (last visited Oct. 30,
2008).
35It
8
organization, allowing the service to monitor the activity of the organization and ensure it is still
operating solely in a not-for-profit capacity.41 Churches may choose to file or not file a Form
990, thus are essentially able to function without government oversight. The danger is that some
churches are collecting large amounts of donations, and disposing of those funds in any way they
see fit, occasionally to the inurement of private individuals. Requiring informational returns
from the current crop of large corporate churches that would otherwise be required to file Forms
990 based on gross receipts would serve a twofold purpose in minimizing church abuse of the tax
exemption. First it would allow greater oversight by the Service, allowing the Service to monitor
and sanction churches acting outside their tax exempt purposes. Secondly, self reporting would
increase awareness within the church organization, encouraging a certain amount of self-policing
to avoid scandal or loss of exemption.
C. AUDITING RESTRICTIONS
The absence of a reporting requirement would not be so glaring if not for the onerous
strictures placed on the Service when investigating churches. In order to initiate an investigation
of any religious entity, an appropriate, high-level Treasury official,42 reasonably believes, based
on facts and circumstances in writing, that a church may not be exempt or is carrying on
unrelated business.43 The Service is also restricted by increased notice requirements44 and is
limited on the extent of any examination only to records which are necessary to determine tax
40
Internal Revenue Service, 2008 Draft Form 990, Updated Sep. 11, 2008, http://www.irs.gov/pub/irsdft/f990--dft.pdf (last visited Oct. 30, 2008).
41 Id.
42 I.R.C. § 7611(h)(7) (added by Pub. L. No. 98-369) (Must be initiated by an official ranking no lower
than Regional Commissioner).
43 I.R.C. § 7611(a)(2).
44 I.R.C. § 7611(a)(3).
9
liability or church status.45 Additionally, investigations are limited in length to two years. Even
though this may be too short a period to investigate large multi-state, and sometimes international
church organizations.46 If an examination does not result in a revocation of exemption or a
request for significant change in operational practices, further investigation is barred for five
years without written consent of the Secretary of the Treasury, unless it involves the same or
similar issues from the previous inquiry.47
While these measures are seemingly implemented to alleviate any fears, and counter any
allegations of harassment on the part of the Service, they also serve to impede investigations of
religious organizations who would otherwise be suspected and perhaps even audited. The
requirement for written recording of facts and circumstances, and the additional requirement of
high level approval of any investigation may stave off supposed “witch-hunts” by low level
Service officials, but also serve to make officials wary of investigating religious organizations.
This may result in any abuse of tax exempt status to go on much longer than otherwise would
have been permitted.
Combining the lack of adequate reporting with an oversight system effectively hamstrung
by well-intentioned Code provisions offers the opportunity for any abuse of tax exempt status by
churches to flourish. Shielded by statutes and claiming rights stemming from incorrect
interpretations of First Amendment precedent,48 some modern churches seemingly operate
45
I.R.C. § 7611(b)(1).
I.R.C. § 7611(c)(1).
47 I.R.C. § 7611(f).
48 See infra Part III.
46
10
outside the tax code, claiming right to an almost sovereign status.49 This flies in the face of the
origins of the church tax exemption and the sovereign power of the United States government.
While the State unnecessarily frets about infringing upon the church, it disregards the blatant
fleecing of parishioners and non-parishioner taxpayers.
III. A BRICK IN THE WALL? REFUTING FIRST AMENDMENT ARGUMENTS FOR MINIMAL
OVERSIGHT
A. THE WALZ DECISION
The church community’s fears of government infringement on religion through malicious
manipulation of the Tax Code are not without merit. John Marshall recognized the unique power
the State wields through taxation.50 However, the “wall of separation” between church and state
was not referenced by the Supreme Court until 1878,51 and any question of State power to tax the
church as a result of that “wall” did not arise for another eight years.52 The greatest support for
the idea churches are sheltered by this “wall” from the financial oversight of the State comes
from the Supreme Court’s decision in Walz v. Commissioner.53 The Supreme Court in Walz
found that state property tax exemptions for churches did not constitute a subsidy for churches,
49
A plethora of web pages exist, with a variety of pseudo-legal jargon, advancing this theory of church
sovereignty. While not in any way binding (and in most cases short-sided, or wholly inaccurate), they serve
to reinforce this idea in the minds of churches and parishioners. See Heal Our Land Ministries, 501(c)(3)
Myths, Revised June 14, 2004, http://hushmoney.org/501c3-myths.htm (last visited Oct. 30, 2008);
FreeChurchMinistry.com, http://www.freechurchministry.net/ (last visited Oct. 30, 2008).
50 McCulloch v. Maryland, 17 U.S. 316, 431 (1819) (“The power to tax is the power to destroy”).
51 Reynolds v. U.S., 98 U.S. 145, 164 (1878).
52 Gibbons v. District of Columbia, 116 U.S. 404 (1886). The Gibbons Court found that the statute
exempting churches from taxation did not include auxiliary buildings not used for church purposes. No
First Amendment claim was made, despite the issue arising in a Federal District governed by the preincorporation First Amendment, a tacit acceptance that tax exemption in the Federal sphere existed solely
by statute.
53
Walz, 397 U.S. at 674 (1970).
11
and were therefore not an establishment of religion,54 but anti-reporting advocates have seized on
another idea from Walz, attempting to apply it to all instances of church taxation:
Determining that the legislative purpose of tax exemption is not aimed at establishing,
sponsoring, or supporting religion does not end the inquiry, however. We must also be
sure that the end result-the effect-is not an excessive government entanglement with
religion. The test is inescapably one of degree. Either course, taxation of churches or
exemption, occasions some degree of involvement with religion.55
From this bit of dicta, church advocates argue that any action by the State in the realm of
taxation would create an excessive administrative entanglement between church and state.56
However, further reading finds Chief Justice Burger narrowly construing what he would consider
“excessive entanglement” that would interfere with free exercise:
Elimination of exemption would tend to expand the involvement of government by giving
rise to tax valuation of church property, tax liens, tax foreclosures, and the direct
confrontations and conflicts that follow in the train of those legal processes.57
Chief Justice Burger refers to the possibility of entanglement should the State choose to
remove the exemption. There is no clear attempt by Burger to delineate that any State
involvement in the tax exempt nature of churches would constitute an entanglement. He was
merely noting the worst case scenario should the State choose to remove the exemption. In fact,
the Court offers that interplay between church and State is not only acceptable, it is necessary:
(W)e will not tolerate either governmentally established religion or governmental
interference with religion. Short of those expressly proscribed governmental acts there is
room for play in the joints productive of a benevolent neutrality which will permit
religious exercise to exist without sponsorship and without interference.58
Walz also goes on to cite Court precedent upholding the right of the State to choose to tax
or not:
54
Id. at 680.
Id at 674.
56 See Hoff, supra note 3, at 114-115.
57 Walz, 397 U.S. at 674 (emphasis added).
55
12
In the exercise of this (taxing) power, congress, like any state legislature unrestricted by
constitutional provisions, may, at its discretion, wholly exempt certain classes of property
from taxation, or may tax them at a lower rate than other property.59
Requiring churches function as other 501(c)(3) organizations in order to maintain tax
exempt status is not a proscribed act. To argue under Walz that State power to require reporting
does not apply to churches because reporting impedes free exercise through excessive
entanglement neglects the origins of the church tax exemption and reporting exception, and
offers an untenably broad reading of the First Amendment precedent in Walz.
An argument may be made that the Walz decision established or illuminated a non-profit
niche that set churches apart from other tax exempt organizations. This is essentially an
argument that because removing the exemption would most likely create excessive
entanglement,60 any action taken against churches by the Service that could result in removal of
that exemption, including requiring reporting and auditing, constitutes entanglement forbidden
by the First Amendment. This argument is absurd. A fair reading of Chief Justice Burger’s
language clearly shows his concern centered on wholesale removal of the exemption from all
churches,61 not some form of administrative oversight to prevent church abuse of the tax exempt
system. Burger merely notes that having the exemption is less entangling than not having it.62 To
accept an expanded reading of Burger’s opinion would preclude the Service from ever
58
Id. at 669.
Walz at 679-680 (citing Gibbons at 408); see also supra note 52.
60 Walz at 674 (Elimination of exemption would tend to expand the government’s role, likely
impermissibly entangling church and state).
61 Id.
62
Id. at 674-676; see also Jimmy Swaggart Ministries v. Board of Equalization of California, 493 U.S.
378, 393 (1989) (Invoking Walz “In upholding the tax exemption, we specifically noted that taxation of
religious properties would cause at least as much administrative entanglement between government and
religious authorities as did the exemption”).
59
13
investigating any organization claiming to be a church for fear of excessive entanglement. This
was clearly not the intention of the Walz Court.
B. BEYOND WALZ
Post-Walz decisions bear out a narrow reading of Walz. The Supreme Court has since
upheld broad powers of the State to classify tax exempt organizations,63 and offered language
that exemption is, in fact, a form of subsidy.64 In another, plurality decision the Court held that
sales tax exemptions of religious publications were not necessary under Free Exercise to prevent
excessive entanglement.65 If the Court finds that church collection of sales taxes and the
requisite reporting requirements of that collection do not create entanglement, can it fairly be said
that the reporting requirements under 501(c)(3) are so entangling that churches warrant an
exemption? The issue is most clearly illuminated in Jimmy Swaggart Ministry v. Board of
Equalization, where Swaggart Ministries challenged a California state imposed sales tax on
religious articles sold at evangelistic crusades.66 There the Court found the Free Exercise only
prevents a State imposed tax on religious organizations when the State requires a flat license fee
tax that acts as prior restraint on free exercise.67 That is, a tax on churches is impermissible only
if the burden imposed by the tax statute effectively prohibits the church from exercising its
religious liberties. Additionally, the Court found generally applicable administrative
recordkeeping may be imposed on religious organizations without running afoul of the
63
Regan v. Taxation with Representation, 461 U.S. 540, 547 (1989).
Id. at 547 (Noting that Congress can subsidize and broadly classify who they subsidize).
65 Texas Monthly Inc v. Bullock, 489 US 1, 15 (1989) (plurality).
66 493 U.S. 378 (1989).
67 Id. at 389.
64
14
Establishment Clause.68 It would seem the Court in Swaggart succinctly answers any question of
both the State’s right to tax the church, and the right to require reporting whether or not it
chooses to tax.
There may be one instance where reporting requirements may become a burden on Free
Exercise. Even the Form 990EZ69 can prove burdensome on small congregations who may or
may not have accountants or keep good records of their activities. However, an exception for
these small, community churches already exists under 501(c)(3): recognized exempt
organizations, with gross receipts of under $25,000, are excepted from filing Forms 990.70
Additionally, other public organizations may be excepted from reporting at the discretion of the
Secretary of the Treasury.71 Any church with a salaried minister will probably meet the $25,000
threshold, and should therefore file a Form 990. However, imposing reporting requirements on
churches would not harm the smallest churches, would not unduly burden larger churches, and
would not violate the First Amendment. It would only impact churches who take in a large
amount of tax exempt funds.
68
Id. at 393.
Internal Revenue Service, Form 990EZ, http://www.irs.gov/pub/irs-tege/f990rez.pdf (last visited Oct.
30, 2008).
70 I.R.C. § 6033(a)(3) (2009); Treas. Reg. § 1.6033-2(g) (2009). See also Internal Revenue Service, Filing
Requirements, http://www.irs.gov/charities/article/0,,id=96103,00.html (last visited Oct 30, 2008) (Small
organizations with gross receipts under $25,000 need only file an e-postcard).
71 I.R.C. § 6033(a)(3)(B) (2009).
69
15
IV. GENESIS: THE ORIGINS OF THE CHURCH REPORTING EXCEPTION IN AMERICA
A. BY GRACE ALONE: EARLY HISTORY OF CHURCH TAX EXEMPTION
The idea of expressly exempting churches from State taxation, along with excepting them
from reporting church income has long roots stretching throughout recorded history.72 However,
the current struggle by churches to maintain freedom from reporting and accountability seems
fueled by a sense of entitlement on the part of churches to a general right of exemption from
State taxation and freedom from reporting or accountability under a flawed interpretation of the
First Amendment.73 This interpretation stands in stark contrast to historical evidence. The clear
conflict on this point hinges on whether churches have a right to a tax exemption and reporting
exception, which could only be modified by Constitutional amendment, or merely a privilege to
such exemptions, which could be altered or eliminated at any time through statutory enactment.
A cursory look at the history of the church tax exemption offers conclusive evidence that the
church tax and reporting exemptions have existed, and continue to exist as a legislative grace,
created through statute and subject to the will of Congress.
Beginning in the colonial period, whether by colonial constitutional provision or statute,
any tax exemption provided to churches, whatever its reasoning, was expressly granted by the
sovereign.74 In Colonial America, the tax treatment of churches differed colony to colony, with
nine colonies providing direct tax aid or some form of exemption to State-supported churches.75
Far from a wall of separation, individual colonies levied taxes to support State-established
72
See Vaughn E. James, Reaping Where They Have Not Sowed: Have American Churches Failed to
Satisfy the Requirements for Religious Tax Exemption? 43 CATH. LAW. 29, 32-38 (2004).
73 See infra Note 49, and Part III.
74 See id. at 38; see also infra IV.A. and IV.B.
75 See Vaughn E. James, Reaping Where They Have Not Sowed: Have American Churches Failed to
Satisfy the Requirements for Religious Tax Exemption? 43 CATH. LAW. 29, 39 (2004).
16
churches and their clergy, as well as providing broad tax exemptions to the State-established
churches.76 Even in an era of State-established churches, the individual states saw fit to codify
church tax exemptions in state law. Express codification served as an implicit declaration of the
sovereignty of the State and of the privilege of tax exemption extended to select churches by the
sovereign. Exemptions were not granted to churches as a group, rather, they were most often
granted to the preferred church, often separately penalizing non-established churches through
increased taxation. This preferential treatment reinforces the idea that exemption and exceptions
were statutory privileges granted by the State legislatures, not some right of churches to be free
from taxation by the State.77
During the post-revolutionary period there was a distinct shift away from established
churches culminating in the Establishment Clause of the First Amendment.78 Even after passage
of the First Amendment, the requirement of separation of church and State had little impact on
states granting tax exemptions to churches.79 Nowhere in the new Constitution was taxation of
churches either forbidden or permitted, so states filled the vacuum, granting via statute the tax
exemptions traditionally held by churches.80 Again, the fact that states, and eventually the
federal government,81 felt the need to extend traditional church tax exemptions by way of express
statute seems to indicate state and federal legislatures believed the several states’ constitutions
76
Id.
Id. (Citing series of constitutional and statutory provisions instituted by colonies).
78 Id. at 40.
79 Id.
80 Vaughn E. James, Reaping Where They Have Not Sowed: Have American Churches Failed to Satisfy
the Requirements for Religious Tax Exemption? 43 CATH. LAW. 37, 40 (2004).
81 Id. at 41.
77
17
and the First Amendment to the United States Constitution provided no such exemptions.82 This
is implicit evidence the church tax exemption exists not by right, but by legislative intent and
action.
Throughout the nineteenth century, the disestablishment movement worked to remove
broad church tax exemptions.83 Speakers from James Madison to Ulysses S. Grant warned the
accumulation of untaxed church property could lead to encroachments by the church upon the
state, allowing it to garner political power and eventually affect the political process.84 State
courts began to recognize that exempting churches from State taxation not only subsidizes
religion, but also acts as a penalty to non-religious entities whose tax burdens are proportionately
increased.85 These sentiments led to a changing idea of the role of the church at the dawn of the
twentieth century. The church would now be seen as a charitable organization doing
immeasurable service for the state, and thus deserving a grant of exemption.86 While the
charitable role of the church was being defined and offered as the reasoning for exemption from
taxation, the idea that the church could be taxed seemed relatively unquestioned.
82
Neither the First Amendment to the Constitution, nor any of the Bill of Rights, were enforced against
individual state governments until these rights were incorporated well after the passage of the Fourteenth
Amendment. See e.g. Gitlow v. New York, 268 U.S 652 (1925). Before this states were only bound by their
individual constitutions in matters such as establishing religions. Eventually the Court would incorporate
most Bill of Rights protections through the Fourteenth amendment. See Cantwell v. Connecticut, 310 U.S.
296, 303 (1940) (Incorporating the Free Exercise Clause); Everson v. Board of Education, 330 U.S. 1, 15
(1947) (Incorporation of the Establishment Clause).
83See James, supra Note 80.
84 See John Witte, Jr., Tax Exemption of Church Property: Historical Anomaly or Valid Constitutional
Practice?, 64 S. CAL. L. REV. 363, 382 (Jan. 1991). How these speakers’ views impact the current church
political speech debate are not at issue in this article, but these statements seem to glimpse forward into the
current state of church-state relations.
85 Orr v. Baker, 4 Ind. 86, 88 (Ind. 1853).
86 See Witte, Jr., supra note 20, at 387-388 (Citing various state court cases noting the community service
functions of the church.).
18
B. A PLACE IN THE CODE: TWENTIETH-CENTURY CHURCH TAX EXEMPTION
The modern church tax exemption first found its way into federal law in the
unconstitutional Revenue Act of 1894. This Act contained a provision exempting corporations
and associations organized and conducted solely for charitable, religious, or educational purposes
from a two percent tax on net profits.87 While that tax law was found unconstitutional on other
grounds, the “religious, charitable, educational” exemption provision again found its way into the
Corporation Excise Tax Act of 1909.88 Churches were exempted from that act because their
presumed function is not to increase individual wealth, but to relieve suffering and economic
hardship.89
From that point forward Congress exempted churches from income taxation based on the
church’s benevolent function in society, as it does currently for any 501(c)(3) corporation.90
There was no mention of an absolute right to be free from government taxation or interference
under the First Amendment. At this time, Congress, through the statute, placed churches on
equal footing with other charitable, non-profit corporations who were also free from any taxation
or reporting requirements.91 It was assumed all income from investment or donation went to
support some public charitable purpose.92 After passage of a national income tax under the
Sixteenth Amendment and the Revenue Act of 1913, some form of church tax exemption and
reporting exception has remained a part of the income taxation system.93
87
Tariff of 1894, Ch. 349, § 32, 28 Stat. 509, 556 (1894).
See Hoff, supra note 3, at 77.
89 Id. at 78 (citing 44 Cong. Rec. 4150 (1909)).
90 See supra Part II.
91 See Hoff, supra note 3, at ??? (citing 44 Cong. Rec. 4150 (1909)).
92 Id. at 80 (citing 44 Cong. Rec. 4150-51 (1909)).
93 See Bob Jones University v. U.S, 461 U.S. 574, 589 n.14 (1983) (The church tax exemption has been
included in every income tax enacted by Congress since enactment of the Sixteenth Amendment in 1913).
88
19
Fearing unfair competition between the commercial activities of tax exempt, non-profit
corporations and that of taxable for-profit entities, in 1943 Congress began requiring other nonprofit and charitable organizations to file annual informational returns.94 From 1944 until 1969
churches and religious organizations remained explicitly exempt from any reporting requirements
by act of Congress, with no mention of a First Amendment rationale for the exemption.95
The Revenue Act of 1950 began imposing taxes on business unrelated to an
organization’s non-profit activity. The Act also narrowed the category of religious organizations
exempt from annual reporting of unrelated business income, allowing only churches and
conventions or associations of churches to withhold such reporting.96
The Tax Reform Act of 1969, for the first time, required newly formed non-profit
organizations to apply to the Internal Revenue Service for a determination of their tax exempt
status.97 That Act also extended reporting requirements to schools, colleges, and public charities,
but once again churches were expressly exempted from those determination and reporting
requirements.98 With the Tax Reform Act of 1969, however, Congress adopted a new viewpoint
on the reasoning for church tax exemption and reporting exceptions. In the wake of arguments
made to the United States Supreme Court in Walz v. Tax Commission,99 debate in the Senate
would shift the basis for exemption from the unlikelihood that a church would have net income
94
See Hoff, supra note 3, at 81 (Citing The Revenue Act of 1943, ch. 63, 58 Stat. 21, 36-37).
Revenue Act of 1944, 78 Cong. Ch. 63, 58 Stat. 21, 36 (February 25, 1944). (Noting non-profits must
file annual returns, exempting churches, religious organizations certain educational organizations
(schools), and organizations funded or operated by the United States).
96 See Hoff, supra note 3. The definition of “church” seems to still be a matter of some debate, see also
supra Part II.A.
97 See Hoff, supra note 3, at 82-83.
98 Id.
99 397 U.S. 664 (1970).
95
20
over its costs, to a consideration of the Establishment Clause principles of separation of church
and State.100 Against this backdrop, the 1969 act also included a limitation on church audits.
This limitation was carried over into the Deficit Reduction Act of 1984, and is now codified as
Internal Revenue Code § 7611.101 The question is, what was the rationale behind shifting the
traditional theories of church reporting exceptions as a matter of privilege, to a rights-based
model of ever-changing First Amendment jurisprudence? The simple answer is there was no
rational reason for altering Congress’s original reasoning for church tax exemption and reporting
exceptions after nearly two hundred years of practice, and there was no Constitutional
admonition to do so. While the Supreme Court’s decision in Walz seemed to indicate a fear of
administrative entanglement through reporting,102 the Court’s biggest fear of government
entanglement was in removing the exemption altogether.103 Removal is a far cry from minimal
reporting requirements.
V. LEVIATHAN: MEGA-CHURCHES AND ABUSE OF THE REPORTING EXCEPTION104
The problem of church tax and reporting exemption abuse is not new. Fears throughout
the nineteenth century,105 to the rise of “new” churches and “mail-order” ministries in the 1960s
100
Id. at 84 (Citing Senate Comm. On Finance, 91st Cong., 1st Sess., Tax Reform Act of 1969:
Compilation of decisions Reached in Executive Session 53 (Comm. Print. 1969)). For a more detailed look
at the impact of Walz, see id. at 107-116.
101 Id. at 85, see also supra I.R.C. § 7611(2009) and Part II.
102 Walz, 397 U.S. 664, 674 (1970). (“Determining that the legislative purpose of tax exemption is not
aimed at establishing, sponsoring, or supporting religion does not end the inquiry, however. We must also
be sure that the end result - the effect - is not an excessive government entanglement with religion”).
103 Id.
104 Mega-Churches differ from larger denominational churches, as larger faiths are often broken into
smaller, self- governing administerial units like dioceses, conventions and synods. Another distinction lies
in the direct, almost unilateral control individual ministers hold over Mega-Church congregations. This is
in stark contrast to the graduated power structure evident in organizations like the Catholic Church. This is
not to say these larger organizations should not report, they are merely beyond the limited focus of this
paper.
21
and 1970s106 and including the scandals of the late 1980’s and early 1990’s, have all contributed
to a belief that tax exempted churches may be out of control. The problem of private inurement
of church administrators found the media spotlight in the late 1980’s. Even the legal community
took note of a slew of abuses. Article after article was written in 1991 alone, each offering some
solution to the latest crisis of the American conscience.107
In an era rocked by scandal, none loomed larger than the Praise the Lord (“PTL”) scandal
involving Jim and Tammy Faye Bakker.108 Jim Bakker was alleged to have diverted millions of
dollars garnered from his PTL ministries to personal accounts and eventually served nearly five
years in federal prison on fraud charges.109 Cases like his illuminated a need for more oversight
of organizations that were taking tax deductable donations from private citizens, private citizens
who thought they were giving to a charitable cause. In fact, according to a survey conducted in
another 1991 article, the PTL was one of only two television ministries that refused to voluntarily
105
See supra Part IV.
See Founding Church of Scientology V. U.S., 412 F.2d 1197 (1969); Universal Life Church v. U.S.,
372 F. Supp. 770 (E.D. Cal. 1974)(Mail order churches).
106
107
See Reka Potgeiter Hoff, The Financial Accountability of Churches for Federal Income Tax
Purposes: Establishment or Free Exercise? 11 VA. TAX REV 71 (Summer 1991); Vaughn E.
James, Reaping Where They Have Not Sowed: Have American Churches Failed to Satisfy the
Requirements for Religious Tax Exemption? 43 CATH. LAW. 29 (2004); John Witte, Jr., Tax
Exemption of Church Property: Historical Anomaly or Valid Constitutional Practice?, 64 S.
CAL. L. REV. 363 (Jan. 1991); Oliver S. Thomas, Address to the Cumberland Law Review
Church/State Symposium: The Power to Destroy: the Eroding Constitutional Arguments for
Church Tax Exemption and the Practical Effect on Churches. (Reprinted 22 CUMB. L. REV. 605
(1992)).
108
Associated Press, IRS Wants $52M from PTL Ministries, Claims it Only Owes $5M, from Philadelphia
Daily News, Dec. 11, 1987.
109 Reuters, Repentant Jim Bakker Leaving Jail a TV Preacher After Serving 5 Years, from Philadelphia
Daily News, Nov. 29, 1994.
22
file Forms 990 with the Service, claiming an exception to reporting under their church status.110
This was a multi-million dollar organization, legally functioning outside the bounds of the Tax
Code, amassing huge sums of money, at a substantial cost to the government in terms of
charitable amounts deducted from individual income tax returns; essentially, subsidized graft.
While the televised nature of the PTL and other ministries pushed them into the public
spotlight, today the accountability exception faces another crisis: the Mega-Church. The MegaChurch is a growing phenomenon, composed of largely Protestant congregations numbering
2,000 or more.111 Examples include the Lakewood Church in Houston, Texas and the
Saddleback Church with “campuses” across California. The largest American Mega-Churches
average 35,000 or more congregants in actual attendance.112 This does not account for those
claiming association with a church through television and radio broadcasts or other media. These
churches, with their massive donor bases, are subject to the same accountability exceptions that
gave rise to the scandals of the 1990s. The potential for widespread abuse alone should prompt
an outcry for increased accountability, but this is about more than the mere potential for abuse.
Recent Senate panel investigations led by Senator Charles Grassley of Iowa have cast
light on some of the questionable spending practices of six Mega-Churches.113 None of the
ministries whose financial and business records were requested by Grassley’s panel were
110
Il-Woon Kim, Charles K. Moore, Richard W. Metcalf, Form 990: Useful in Analyzing Not-For-Profit
Ministries?, 8 AKRON TAX J. 73,75 (1991). The other ministry claiming church exemption, Jimmy
Swaggart Ministries, also faced scandal during the period. See Jimmy Swaggart Ministry v. Board of
Equalization, 493 U.S. 378 (1989).
111 Hartford Institute for Religion Research, Megachurch Definition,
http://hirr.hartsem.edu/megachurch/definition.html (last visited Oct. 30, 2008).
112 Id.
23
required to file Forms 990 because of their church designation.114 The six ministries - Kenneth
Copeland, Creflo Dollar, Benny Hinn, Eddie Long, Joyce Meyer, and Randy and Paula White were asked for detailed financial information,115 possibly to explain the following:
-
Kenneth Copeland’s use of the ministry jet for layovers in Maui, Fiji and
Honolulu;116
-
Creflo Dollar’s Rolls Royce and homes in New York and Georgia;117
-
Benny Hinn’s seven bathroom, eight bedroom home, valued at 10 million dollars,
which is not claimed on his tax return under the parsonage exemption at Internal
Revenue Code § 107(1);118
-
Eddie Long’s $300,000 Bentley automobile, and the fact he no longer accepts a
salary, but receives an unclaimed love offering;119
113
CBS News.com, Senate Panel Probes 6 Top Evangelists, Nov. 6, 2007,
http://www.cbsnews.com/stories/2007/11/06/cbsnews_investigates/main3456977.shtml (last visited Oct.
30, 2008).
114 Ted Olsen, Senate Committee Investigating Six Major Ministries. Christianity Today, Nov. 6, 2007,
http://www.christianitytoday.com/ct/2007/novemberweb-only/145-22.0.html (last visited Oct. 30, 2008).
115
Rob Boston, Senator's Inquiry Into Megachurch Money Hypocrisy Sparks Church-State
Showdown, Jan. 11, 2008, http://www.alternet.org/story/72539/?page=entire last visited Oct. 30,
2008).
116
Id. at 1.
Id.
118
Id. It is assumed Hinn is only deducting the fair rental value of the home, as is required by the code. For
a more detailed look at the recent implications of the parsonage exemption see Erwin Chemerinsky, The
Parsonage Exemption Violates the Establishment Clause and Should be Declared Unconstitutional, 24
WHITTIER L. REV. 707 (2007).
119 Id.
117
24
-
Joyce Meyer’s expenditures like a $23,000 commode with a marble top, a $30,000
conference table, an $11,000 French clock and a pair of $19,000 vases for the
ministry headquarters.120
While these expenditures may be explainable, and while congregants may not realize the
opulent lifestyle they are providing to their ministers, Senator Grassley rightly worries that it is
the American taxpayers at large who are truly being fleeced, subsidizing these ministers’ largesse
through a disproportionate tax burden.121 While the average American pays tax on his or her
income, Mega-Church ministers receive tax free money from donors, enjoy largely unclaimed
valuable fringe benefits,122 and can avoid the self-employment tax.123 This is private inurement,
plain and simple, but due to lack of reporting, and unnecessarily complex auditing procedures, it
takes action by a Senate panel to make an effective inquiry. Exemplifying the audacity of these
ministers and their belief in an unfettered right to tax exemption, when faced with Grassley’s
request on behalf of taxpayers, the Reverend Dollar initially refused to provide any information,
attempting to cloak himself in the Service’s complex auditing procedures.124
Despite the uproar over ministerial inurement in 1991, little has changed. The early
refusal by some of the ministers to Senator Grassley’s request reflects how entrenched the sense
of entitlement to exemption remains among churches today. This is not a private matter;
120
Id.
Id.
122 Id.
123 I.R.C. § 1402(a)(8).
121
124
Rob Boston, Senator's Inquiry Into Megachurch Money Hypocrisy Sparks Church-State
Showdown, Jan. 11, 2008, page 2, http://www.alternet.org/story/72539/?page=entire (“According
to media accounts, Dollar's attorneys sent Grassley a letter telling him to either refer the matter to
the IRS or issue a subpoena”) (last visited Oct. 30, 2008).
25
churches are not sovereign entities; the American taxpayer has a right to know how his or her
money is being spent, either by the church or by the government in the form of tax exemptions;
and the government has a duty to protect citizens from those who would take their property
through fraudulent or deceptive practices.
VI. LIGHT IN THE WILDERNESS: THE GOVERNMENT’S ROLE AS PROTECTOR
But the question is not only can the State require reporting of tax exempt organizations,
but whether the State should require reporting as a part of its necessary function if protecting its
citizens. While the implication of a fundamental right, like free exercise of religion under the
First Amendment, may trigger the strictest constitutional scrutiny,125 even then the Court has held
the State may justify infringing on religious liberty by showing that it used the least restrictive
means of achieving some compelling State interest.126 But as shown the Court has held taxation
not to be an excessive entanglement or infringement,127 and certainly reporting requirements are
less restrictive, less entangling, than taxation.128 With that settled, the real issue hinges on the
classical duty of the State to protect its citizens from that which injures them.129
The enlightenment idea of the role of government in securing rights and property found
purchase in the minds of America’s founding fathers and found voice in the Declaration of
Independence.130 Even the Preamble to the Constitution includes promoting the general welfare
as a stated purpose of the newly enacted government.131 Embracing the social contract theory of
125
U.S. v. Carolene Products, 304 U.S. 144, 153 n.4 (1938).
Thomas v. Review Bd. of Indiana Employment Sec. Division, 450 U.S. 707, 718 (1981).
127 See supra Part III.
128 Walz, 397 U.S. at 674.
129 See supra Note 1.
130 Declaration of Independence. (“To secure these rights, governments are instituted among men”).
131 U.S. Const. Preamble.
126
26
government on which this country was founded, and considering the State’s monopoly on
prosecuting crimes such as fraud and embezzlement, it could be easily argued the State owes a
duty to at least make some effort to protect citizens from a church who seeks to defraud its flock
and the tax code.132 Considering the sheer number of citizens affected, this should create a
compelling State interest.133
Even if it is beyond the State’s purview to monitor how individual citizens choose to
spend their money and where that money goes, it is unconscionable to require every other
taxpayer to subsidize those “donations” under the guise of deductable charitable giving. By
offering a no-strings tax exemption to any organization claiming to be a church, the government
is creating an environment that encourages abuse. By turning a blind eye to all but the most
egregious cases, the State is tacitly creating a culture that allows such subsidized graft to flourish,
in direct violation of its duty as sovereign to protect citizens from those corrupt practices and the
organizations that propagate them.
VII. CONCLUSION
Nearly forty years after Walz, the longstanding idea that tax exemption and the reporting
exception exist as a matter of legislative grace, a grant of privilege from the sovereign, is
muddied by misinterpretation. Even the Service is confused about churches:
Congress has enacted special tax laws…in recognition of their unique status in American
society and of their rights guaranteed by the first amendment of the Constitution of the
132
See Susan Bandes, The Negative Constitution: A Critique, 88 MICH. L. REV. 2271, 2321 n.264 (1990)
(citing Richard L. Aynes, Constitutional Considerations: Government Responsibility and the Right Not to
Be a Victim, 11 PEPP. L. REV. 63, 75-77 (1984)).
133 Bob Jones Univ. v. U.S., 461 U.S. 574, 604 (1983) ( A compelling State interest substantially
outweighs burden denial of tax exemption places on Free Exercise).
27
United States.134
The Service in its own resources seem unsure whether the right to church tax exemption
stems from rights under the First Amendment, or through privilege via statute granted by
Congress. Until 1969, this distinction was quite clear, and although Walz may have questioned
how entangled the state would become if the exemption were removed; there was no clear
prohibition against it. Subsequent decisions by the Court have only reinforced the position that
requiring reporting practices similar to those required of any other tax exempt organization do
not conflict with the principles embodied in the First Amendment.
The perception of continued abuse of the reporting exception by churches to the
inurement of private individuals, and the duty of the State to protect its citizens from such abuses
makes one thing abundantly clear: Churches, large and small, should be held to the same
standards as any organization seeking public tax exempt status under 501(c)(3), imposing
reporting requirements on those churches with net proceeds large enough to warrant reporting
under the Code. While traditionally churches have never been taxable or subject to the laws of
taxation, this exception has little historically to do with Constitutional liberties. Additionally
individual churchgoers and their income have always been taxable. Churches as they now exist
are organizations that subsist almost solely upon taxpayer donations in some form. Churches
would like those donations to be tax deductable to the taxpayer. If the government is not taxing
money individual taxpayers are donating to churches, it is not an invasive request for the
government to inquire where that money is going on behalf of the taxpayer. This is not a
134
Internal Revenue Service, Tax Guide for Churches and Religious Organizations: Benefits and
Responsibilities Under the Federal Tax Law, p. c2, http://www.irs.gov/pub/irs-pdf/p1828.pdf (last visited
Oct. 30, 2008).
28
question of religion, but one of the fundamental role of the State. There is no right held by
anyone to graft subsidized by honest taxpayers. Citizens entrust legitimate governments with the
sole power and duty to find and punish that which injures them, even when that which is
injurious is veiled in religious garb.
29