A federal judge in Texas has thrown out an agreement from the Trump administration that would have permitted religious institutions to back political candidates while maintaining their tax-exempt nonprofit status.
U.S. District Judge J. Campbell Barker in Tyler, Texas, determined on Tuesday that he did not have the authority to approve the consent agreement between the Internal Revenue Service and two Texas churches along with the National Religious Broadcasters.
The proposed deal would have classified standard religious communications as being outside the scope of a longstanding federal tax law that prevents both religious and secular nonprofits from backing political candidates.
The IRS reached this agreement in July as part of settling a legal challenge brought by the National Religious Broadcasters, a Christian broadcasting association, before the 2024 presidential race. The lawsuit targeted the 1954 tax provision commonly called the Johnson Amendment, named after then-Senator Lyndon Johnson.
However, Judge Barker, who received his appointment from Trump during his first presidency, agreed with critics from Americans United for Separation of Church and State that the Tax Anti-Injunction Act prevented him from endorsing the arrangement.
This federal law generally blocks legal actions aimed at stopping tax collection. Barker explained that ruling the Johnson Amendment doesn’t cover certain activities “would thus directly bear on the amount of tax that could be collected.”
Rachel Laser, who leads Americans United for Separation of Church and State, praised Barker’s decision in a public statement, declaring it ensures “the Johnson Amendment will remain a strong bulwark to stop religious extremists from exploiting houses of worship.”
Michael Farris, serving as general counsel for the National Religious Broadcasters, announced plans to challenge the ruling, arguing that Barker overlooked an exception to the Anti-Injunction Act that should have allowed the case to move forward.
The IRS has not provided any response to requests for comment regarding the decision.
The Justice Department had initially defended the law’s constitutional validity under Democratic President Joe Biden before changing its position when Republican President Donald Trump took office. Trump has publicly advocated for eliminating the Johnson Amendment entirely.
When the IRS proposed the settlement agreement last year, the agency argued that applying the Johnson Amendment to conversations between religious institutions and their members would create “serious tension” with First Amendment religious freedom protections in the Constitution.
