The Internal Revenue Service (IRS) has upended more than 70 years of legal precedent by granting churches and certain religious nonprofits a narrow exception to the longstanding Johnson Amendment, thereby permitting direct political endorsements in specific contexts. This landmark decision, filed in federal court on July 7, 2025, marks one of the most significant changes in the relationship between politics and religious organizations since the tax code’s 1954 overhaul.

The move arrives amid intensifying national debates over the role of faith in public life, free speech, and the integrity of the U.S. political system as the country approaches another heated presidential election cycle.

Background: What Is the Johnson Amendment?

The Johnson Amendment, introduced in 1954 by then-Senate Majority Leader Lyndon B. Johnson, prohibits all 501(c)(3) tax-exempt organizations—including churches, charities, and foundations—from endorsing or opposing political candidates. The goal was to curtail indirect political influence and ensure that tax-exempt status could not be exploited for partisan campaigning. Violating the provision has long risked revocation of tax exemption—a threat sporadically enforced but widely respected.

The Court Challenge: Who Sparked the Change?

The IRS position reversal is rooted in a September 2024 lawsuit filed in Texas by a coalition composed of the National Religious Broadcasters, Intercessors for America, and two Texas churches: First Baptist Church Waskom and Sand Springs Church. The Christian organizations argued that the Johnson Amendment infringed on their constitutionally protected free speech and religious expression by muzzling leaders during pivotal civic moments.

After months of legal wrangling and advocacy from conservative groups and religious leaders, the July 7, 2025, court filing signaled an unprecedented willingness by the IRS to allow “narrow exceptions” to the absolute ban, though the agency stopped short of embracing wholesale repeal. According to legal filings, religious groups may now engage in political endorsements provided they adhere to newly defined limitations—details of which are expected to be clarified in forthcoming regulatory guidance.

Controversy and Constitutional Questions

Reaction to the IRS’s reversal has been sharply polarized. Supporters, including former President Donald Trump and influential conservative pastors, hailed the decision as a much-needed restoration of religious freedom and speech rights.

“Government has NO BUSINESS regulating what is said in pulpits!” wrote Pastor Robert Jeffress of First Baptist Church in Dallas, echoing calls from faith leaders nationwide.

On the other hand, organizations such as the Freedom From Religion Foundation (FFRF), American Humanist Association, and the American Civil Liberties Union (ACLU) voiced grave apprehensions. Critics argue the move could erode church-state separation, undermine campaign finance integrity, and introduce a tax-subsidized avenue for dark money to flow into political campaigns via religious entities.

Chris Line, FFRF legal counsel, noted, “We’re in a situation now where churches are allowed to violate this law, but all other groups… were not given that same carve-out.” The ACLU’s Daniel Mach added that the exception raises “serious constitutional concerns” by favoring religious viewpoints vis-à-vis tax benefits—an area the courts may ultimately decide.

Recent statements from secular advocacy groups assert that the rule shift hands a megaphone to Christian nationalist groups and could open the floodgates to billionaires funneling political contributions through churches, with taxpayers effectively subsidizing those expenditures.

Political and Legislative Backdrop

Efforts to roll back the Johnson Amendment have surfaced repeatedly since the early 2000s, often spearheaded by conservative lawmakers and evangelicals. In 2017, Donald Trump signed an executive order instructing the Treasury Department to show leniency toward faith leaders speaking out on “moral or political issues from a religious perspective.” Yet, these actions skirted directly overturning the provision.

In March 2025, new bipartisan legislative proposals—the Free Speech Fairness Act in both the House (sponsored by Rep. Mark Harris, R-NC) and Senate (sponsored by Sen. James Lankford, R-OK)—aim to codify expanded free speech for religious and all 501(c)(3) entities. These bills remain under congressional consideration as America grapples with the equilibrium between First Amendment liberties and campaign finance law.

How Popular Is Political Preaching?

Despite vocal advocacy for change, the American public remains deeply ambivalent. According to a 2024 Lifeway Research survey, only 29% of U.S. adults deem it appropriate for pastors to publicly endorse candidates during services—while 60% disagree, and nearly half (48%) believe churches should lose their tax-exempt statuses for doing so. Nevertheless, acceptance of such endorsements has risen from just 13% in 2008 to almost 30% in 2024, highlighting changing cultural attitudes.

Many religious organizations have remained wary, recognizing both the potential influence and reputational risk inherent to church-based political advocacy.

Potential Impacts and Next Steps

Legal experts caution that the IRS’s new carve-out may soon be tested in both administrative and judicial proceedings. Tax lawyers anticipate a wave of requests for clarification as churches seek to understand the distinction between permissible and forbidden political conduct, wary of risking their tax-exempt status.

Further, with the 2026 Congressional and 2028 Presidential elections on the horizon, political strategists are watching closely to see if the change will shift campaign spending patterns, influence voter mobilization, or encourage other nonprofits to seek equal treatment.

Historically, courts—including the 10th U.S. Circuit Court of Appeals in the 1970s and the U.S. District Court for the District of Columbia—have upheld strong barriers between religious endorsements and tax exemptions. Whether the current reversal withstands further legal challenge remains to be seen.

Outlook: A Precarious Balance

The IRS’s decision represents a pivotal moment in American church-state relations, affecting not just houses of worship but the broader nonprofit sector and the principles underlying tax-exempt philanthropy. As lawmakers, courts, and advocacy groups brace for continued debate, the only certainty is that the intersection of faith and politics will remain a flashpoint in American democracy for years to come.

Stakeholders nationwide—from pastors to secular activists and legislators—now await both regulatory guidance and possible court challenges, all with the future of political speech and religious liberty hanging in the balance.