Focus on the Family is a Christian conservative organization that was founded in 1977 by James Dobson, a psychologist. It is based out of Colorado Springs, and is active in promoting conservative views on public policy. The organization also recently decided to call itself a church which allows it to avoid filing public tax documents.
Previously, and as recently as 2014, Focus on the Family has filed as a non-church nonprofit, and submitted publicly available IRS form 990 as most tax-exempt nonprofits do. However now the group has announced on its website, dated October 26, 2017, the message “not required to file and not filed with the IRS. Not for public inspection.”
This message was attached to a posting of their 2015 990 which showed an operating budget of $89 million. The form indicated “church, convention of churches or association of churches” as the reason for public charity status. The organization also stated that although they are not required to file with the IRS, they will make copies of of their 990 available to donors.
The declaration of being a church is a bit puzzling. An attorney, Gail Harmon, who has worked with nonprofit tax law for over 20 years says, “I just found it shocking. There’s nothing about them that meets the traditional definition of what a church is. 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.”
In fact, the IRS has a list of factors for determining whether an entity is in fact a church. Factors that include things like “distinct ecclesiastical government,” “established places of worship,” and “regular religious services.”
Another tax law expert, Samuel Brunson, seems to think it isn’t so easy to define what counts as a church due to the First Amendment. He says “because of the First Amendment, Congress and the IRS are hesitant to create bright-line rules for fear of creating unconstitutional rules, which means that everything is fairly murky in the area.”
If Brunson is correct, Focus on the Family calling themselves a church may be okay in the eyes of the IRS. Unfortunately, that also means the organization is not required to file and they are shielded from audits. The IRS does have the authority to audit a church but it requires approval from a “high-level Treasury Official.”
The Focus on the Family organization with its 89 million dollar budget suddenly claiming to be a church probably has nothing to do with the fact that the claim will make it exempt from audits and filing with the IRS...