This article appeared in The Oregonian on Sat. April 10, 1993: RELIGION AND POLITICS - Som

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This article appeared in The Oregonian on Sat. April 10, 1993: RELIGION AND POLITICS - Some observers say the IRS' decision to fine Jerry Falwell's group for political involvement is a move in the right direction. WASHINGTON..........by David E. Anderson........Religious News Service.. A decision by the Internal Revenue Service to fine Jerry Falwell's Old Time Gospel Hour(OTGH) $50,000 and revoke its tax-exempt status for two years may be a beginning of a crackdown on involvement of religious groups in politics. That's the assessment of Arthur Kropp, president of People for the American Way, a civil liberties watchdog group, who views it as a positive step. "I think it's an encouraging sign that the IRS is taking a hard look and taking action," he said. Kropp was reacting to a recent announcement that Jerry Falwell's OTGH has agreed to pay a $50,000 fine to the IRS after a prolonged audit of the evangelist's many ministries showed that some activities violated tax laws. The IRS investigation, which scrutinized the organization's activities in 1986-87, found that ministry personnel were used to raise money for a political action committee (PAC), called I Love America Committee, which was formed by an official in Falwell's Moral [sic] Majority [sic] to back congressional candidates. The law bars tax- exempt bodies from participating in political campaigns on behalf of specific candidates. The agreement reached between the government and Falwell brings to an end a far-ranging investigation by the government, involving not only Falwell's ministries but the independent baptist minister himself. Falwell, pastor of Thomas Road baptist church in Lynchburg, Va., is best known as a fiery fundamentalist preacher on the OTGH and as a founder of the Moral [sic] Majority [sic], the most prominent and influential organization of the conservative political movement that tapped into American evangelicalism and fundamentalism. BOTH THE I LOVE AMERICA COMMITTEEE AND THE MORAL [sic] MAJORITY [sic] HAVE BEEN DISBANDED. Earlier, the IRS revoked the tax-emempt status of the Libery Federation, another Falwell organization with a wider public policy agenda than the Moral Majority, after determining it did not operate soley for religious and charitable purposes. Kropp said the $50,000 fine amounted to little more than "a slap on the hand," given that the OTGH raised about $94 MILLION during the years affected by the investigation. "The penalty seems pretty meager." Another critic of church-state entanglement, Brent Walker of the baptist Joint Committee on Public Affairs, agreed that the IRS action shows it is "taking seriously the tax code's prohibition on tax-exempt organziations' engaging in political activity." Terms of an agreement signed in mid-February called for the OTGH to publicize the settlement to media outlets chosen by the federal agency, but many news outlets got information of the the penalty from the IRS. "We followed the instruction exactly," said Mark DeMoss, a spokesman for Falwell. But he said that when nobody picked up the story, the IRS apparently decided to publicize the agreement itself. The agreement calls for the OTG Hours' tax-exempt status to be revoked for the years 1986-87 but reinstated in 1988 and the ministry continue to be tax-exempt. "This closes the Falwell-related audits," said DeMoss, who added that the contributors to the OTGH in 1986-87 will not have to revise their tax returns for that year. "The agreement should not have any impact on the OTGH or its donors," he said. The audits and investigations grew out of a series of congressional hearings in the late 1980s at the time of the scandal surrounding the PTL empire of Jim and Tammy Bakker and concerns that the newly prominent evangelical movmement was misusing - for political or personal purposes - some of the tens of millions of dollars being contributed to the ministeries. Under the law, in order for a non-profit group to remain tax-exempt, it must refrain from partisan political activity or endorsing specific candidates in an election. Money use for such political purposes is not tax-exempt. The IRS reportedly began about 40 investigations of religious groups at the time. In 1991, the IRS assessed the Jimmy Swaggery ministries $171,122 in back taxes and interest for 1985-86.

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