Justice Department Backs Fifth Circuit Appeal Over Johnson Amendment

The Justice Department is asking the Fifth Circuit Court of Appeals to reinstate an agreement that would protect certain political messages from churches from being penalized by the IRS. This agreement, initially reached in July 2025, was rejected by a Texas federal judge in March 2026. The core of the dispute revolves around the Johnson Amendment, a law that prohibits churches and other religious organizations from engaging in political campaign activity if they wish to maintain their tax-exempt status.

The Justice Department’s recent filing supports an appeal to revive this agreement. The agreement specifically covers political messages delivered to a congregation during religious services through the usual ways churches communicate. This appeal is separate from the broader constitutional arguments the religious groups are also pursuing, which seek a more extensive ruling against the amendment itself.

Agreement Details and Scope

The proposed agreement defines protected speech as communications made “to its congregation, in connection with religious services through its customary channels of communication on matters of faith.” This language emphasizes the specific context of the speech: within a religious service, directed at the congregation, and using established church communication methods. It does not create a wide-ranging exemption for churches to become involved in political campaigns generally.

The Justice Department’s stance is that this agreement aligns with the principle of church autonomy. They believe the IRS should not enforce the Johnson Amendment against churches under these specific, limited circumstances. This position is more narrow than the full relief sought by the religious groups, focusing on restoring the deal rather than endorsing all their arguments against the law.

The Anti-Injunction Act and Legal Challenges

The judge who rejected the agreement did so based on the Anti-Injunction Act. This law generally prevents individuals from filing lawsuits to stop the collection of taxes. The government argues that the judge applied the wrong legal reasoning and that an exception to this act should apply.

The immediate issue before the Fifth Circuit is whether the agreement can be put into effect despite the Anti-Injunction Act. The Justice Department is not asking the appeals court to resolve the entire constitutional debate as a condition for reviving the settlement. Instead, they want the court to first address the procedural barrier raised by the Anti-Injunction Act.

Broader Constitutional Claims

Beyond the agreement, the religious groups are also arguing that the Johnson Amendment itself violates the First and Fifth Amendments of the Constitution. Their constitutional claims go further than the settlement, challenging the restriction’s application to churches more broadly. They contend that the law improperly limits their freedom of speech and the free exercise of religion.

If the appeals court sides with the Justice Department on the settlement issue, churches could regain protection for political speech made during sermons and other communications through their customary religious channels, but only within the specific terms of the settlement. This would not eliminate the restriction on all political activities by religious organizations. If the court rejects the settlement, the broader constitutional challenge can proceed independently.

Distinguishing Political Activities

The Johnson Amendment, enacted in the 1950s, links a religious organization’s tax-exempt status to its avoidance of political campaign activities. Historically, churches have had more freedom to support ballot measures or lobby on legislation, as long as these activities do not become a primary focus of their work. Enforcement of the amendment by the IRS has often been described as lenient.

This current appeal specifically concerns the settlement’s defined church communications, not a claim that all political statements by religious organizations are exempt from the tax rule. The case highlights the ongoing legal tension between religious freedom and regulations on political involvement for tax-exempt entities. The outcome could affect how churches communicate on political matters in the future.

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