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Federal Circuit Says "Church" Satus Under Internal Revenue Code Requires Regular Communal Worship

By Howard M. Friedman

In Foundation of Human Understanding v. United States, (Fed. Cir., Aug. 16, 2010), the U.S. Court of Appeals for the Federal Circuit held that the Foundation of Human Understanding, while retaining its 501(c)(3) non-profit status, did not qualify as a "church" for purposes of Sec. 170(b)(1)(A)(i) of the Internal Revenue Code.  The court held that in order to meet the definition of a church, a religious organization must show that it has a body of believers who assemble regularly for communal worship. Seminars across the country do not satisfy this test. The Foundation's radio and Internet ministry also were not enough to meet the associational test: "The fact that all the listeners simultaneously received the Foundation?s message over the radio or the Internet does not mean that those members associated with each other and worshiped communally." Failure to meet the definition of a church can subject a non-profit organization to the private foundation rules of IRC Sec. 509. (See prior posting.) Yesterday's National Law Journal reported on the decision. [Thanks to Joel Sogol via Religionlaw for the lead.]

Full post as published by Religion Clause on August 19, 2010 (boomark / email).