By Sam Brunson
Did you hear that the IRS granted a Satanic cult tax-exempt status in ten days?!? Meanwhile, Tea Party groups’ exemption applications languished for months or even years?!?
I know, it sounds pure conspiracy theory: the IRS loves Satan and hates conservatives. But it’s true! Or, at least, kind of! But it needs to be contextualized, because comparing the exemption application of Reason Alliance, Ltd. (the putative Satanic cult) and Tea Party groups is inapposite.[fn1]
First things first, though: the framing of this “controversy” is purely a product of the Outrage Industrial Complex, as represented by Fox News and Judicial Watch. And I’m sure the invocation of “Satanic cult” is going to get them clicks and shares.[fn2] But Satanic cult? The Reason Alliance is the tax-exempt offshoot of The Satanic Temple, which strikes me as basically a relatively-clever piece of performance art meant to object to religions enjoying tax-exempt status, and which otherwise functions as a much funnier, and more self-aware, version of the Freedom From Religion Foundation and Americans United for the Separation of Church and State. Because The Satanic Temple objects to religions’ exemption from taxation, it has chosen not to pursue tax-exempt status itself. Apparently, though, in the interest of facilitating donations from individuals whose charitable giving is more elastic, it created the Reason Alliance to permit deductible charitable giving.
But the substance of the outrage here isn’t Satan; rather, it’s that Satan could essentially bypass the line (of Tea Party groups, probably) in getting his exemption from tax.[fn3]
But did Satan bypass the line? In a word, no. Historically, would-be tax-exempt organizations had to file a Form 1023 to apply for tax exemption. The Form 1023 is 26 pages long, and requires a significant investment of time in both preparing and in recordkeeping. On average, it takes the IRS 191 days to process exemptions on a Form 1023.
In 2014, the IRS introduced the Form 1023-EZ, a streamlined exemption application. The Form 1023-EZ is available to small groups, ones that have assets of $250,000 or less and annual gross receipts of $50,000 or less. In the first year of the Form 1023-EZ, the IRS reported, the average processing time was 13 days.
And guess what? The Reason Alliance filed a Form 1023-EZ.[fn4]
Now, this isn’t evidence that the IRS isn’t a big fan of Satanic cults. It’s also not evidence that the IRS hates all things Satan from the bottom of its collective heart. But the IRS clearly did not “fast track” the Reason Alliance; the Reason Alliance merely chose a faster route to exemption. (A route, I should note, that was also available to any Tea Party group that applied for tax-exempt status after the middle of 2014, provided that group was willing to limit its net asset value and gross receipts.)
[fn1] (a word which here means “comparing apples and corned beef”) (sorry, we’ve been watching Netflix’s wonderful “A Series of Unfortunate Events,” and I couldn’t help myself).
[[fn2] Which I’m clearly not above; I mean, “Satan” is the first word of this post’s title.
[fn3] To some extent, no duh. What’s the point of being the Dark Lord if you can’t bypass some bureaucracy?
[fn4] Neither Fox nor Judicial Watch explicitly challenge the appropriateness of granting Reason Alliance tax-exempt status, though there’s an undercurrent of skepticism that it should qualify. I’m not going in the weeds with this, in large part because other than the links I’ve provided, I don’t know much about Reason Alliance. But it claimed in its application that it was organized and is operated exclusively to pursue charitable, religious, literary, and educational purposes. Assuming that’s true, and it meets the other exemption qualifications, there’s no reason it should not be exempt from taxation.