A Texas lawsuit briefly raised questions about the future of religious political speech — but a federal judge has now halted that effort.
The Johnson Amendment, which has traditionally served as the boundary preventing churches from making political endorsements, is facing increased scrutiny and potential challenges to its continued relevance.
Discover where the amendment stands and why it might matter for your nonprofit.
The Johnson Amendment: A quick refresher
For decades, the Johnson Amendment has prohibited tax-exempt organizations, including houses of worship, from directly or indirectly participating in political campaigns. The rule is meant to uphold the separation of church and state and maintain the integrity of both elections and charitable giving.
Yet, its critics — especially in religious circles — have long argued it stifles free speech and religious freedom.
The lawsuit: Churches vs. the IRS
On August 28, 2024, a coalition of conservative religious groups filed suit in the U.S. District Court for the Eastern District of Texas. The plaintiffs included:
- National Religious Broadcasters
- Intercessors for America
- Sand Springs Church (Athens, Texas)
- First Baptist Church of Waskom (Waskom, Texas)
Their argument? That the Johnson Amendment violated their rights under:
- The First Amendment (free speech and free exercise of religion)
- The Fifth Amendment (due process and equal protection)
- The Religious Freedom Restoration Act, which prohibits rules that substantially burden religious exercise without compelling interest.
The plaintiffs sought a court order declaring the Johnson Amendment unconstitutional as it applies to their religious speech and an injunction preventing the IRS from enforcing it.
A surprising shift: The IRS backs down some
By July 7, 2025, the case took an unexpected turn. The IRS, rather than fighting to uphold the Johnson Amendment, agreed to a proposed consent judgment with the plaintiffs, including:
- The IRS conceded houses of worship can address their congregations about political candidates or elections during religious services, as long as the message is framed as a matter of faith.
- Such internal, faith-based speech would not count as “participation or intervention” in a political campaign — and would not threaten the church’s tax-exempt status.
- The IRS agreed not to enforce the Johnson Amendment against the two plaintiff churches for this kind of religious communication.
The proposed settlement marked the first time the IRS has formally given ground on the Johnson Amendment’s scope.
If approved, clergy could have endorsed or opposed a candidate from the pulpit without fear of losing the church’s nonprofit status — so long as the endorsement happens in a religious context and is directed to the congregation.
However, that approval never occurred. On March 31, 2026, a federal judge declined to approve the proposed settlement and dismissed the case.
Not so fast: Why a watchdog stepped in
On July 10, 2025, Americans United for Separation of Church and State (AU) filed a motion to intervene. Alarmed by the IRS’s position, AU argued the public interest in maintaining the Johnson Amendment needed defending. The court allowed AU to participate as a “friend of the court,” giving them until July 25 to argue against the settlement.
AU’s concern? That the IRS’s stance would undermine election integrity and the principle of church-state separation by giving religious entities special treatment.
The judge ultimately concluded he lacked authority to approve the settlement, ruling that courts cannot issue declaratory or injunctive relief when doing so would interfere with federal tax assessment and collection.
What happens next with the Johnson Amendment?
As of early April 2026, the proposed settlement is off the table. A federal judge in the Eastern District of Texas rejected the consent judgment and dismissed the lawsuit, leaving the Johnson Amendment fully intact.
The court ruled it lacked jurisdiction to approve an agreement that would affect tax enforcement. While the plaintiffs have suggested an appeal is possible, no changes to IRS enforcement or nonprofit rules took effect as a result of this case.
Why this is still worth paying attention to
Even though the proposed settlement was ultimately rejected, this case remains notable. For the first time, the IRS publicly took the position — in a formal court filing — that applying the Johnson Amendment to certain internal church communications could raise constitutional concerns.
That marked a clear departure from decades of agency practice, during which the IRS defended the amendment’s application broadly while exercising restraint in enforcement.
The court’s dismissal stopped that position from becoming binding law or formal guidance. Still, the episode revealed how federal enforcement priorities and legal interpretations can shift, even without a legislative change.
It also underscored that challenges to the Johnson Amendment are likely to continue, particularly as questions around religious expression, political speech, and nonprofit status remain active areas of debate.
While the Johnson Amendment stands today exactly as written, this case offered a preview of the arguments and fault lines that could shape future efforts to revisit it
Not a church? Why this may impact your nonprofit
For nonprofits outside the religious space, the takeaway is straightforward: nothing changed as a
result of this case. The court’s dismissal means the Johnson Amendment continues to apply to
Section 501(c)(3) tax‑exempt organizations exactly as it did before, including restrictions on political endorsements.
That said, the case is still a reminder that questions around political speech, nonprofit status, and IRS enforcement remain active areas of discussion. While this particular challenge did not alter the rules, it highlighted how legal interpretations and enforcement positions can surface quickly — and just as quickly be stopped by the courts.
For now, nonprofits should continue to follow existing guidance and treat political activity with care. Future challenges may arise, but any meaningful change would require either new legislation, a different procedural path through the courts, or formal IRS guidance.
How CLA can help nonprofits in times of change
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