The church was asked to provide detailed financial information that focused on the compensation of the founder and senior pastor, James (Mac) Hammond.  The church argued they did not have to provide this info.  The IRS earlier in the year petitioned the U.S. District Court to force the church to answer its demand for information.  The argument came back from the church that the request was not made by a “high-ranking official” as required by law and the magistrate judge agreed.  The District Court judge will make a decision whether to follow that recommendation. 

An attorney and spokeswoman for the church, Amy Rotenberg said Hammond and other church officials are pleased with the magistrate’s recommendation.  “We recognize that churches must abide by the tax laws of the United States, and we have,” she said.  “But Congress intended that government needs to tread very carefully when it’s going to enforce the Intenal Revenue Code with regard to churches because of the sensitivity in the relationship between government and churches.”  Rotenberg shared the IRS did not meet this threshold that Congress set.  “It’s important that all of those hoops that Congress wanted the IRS to jump through be actually jumped through,” Rotenberg said.  “And that protects all of us, all people of faiths.  All faith communities will benefit by the structure that Congress put in place, which was to recognize the necessity of separating church and state.” 

At first the magistrate judge’s recommendation seem to rest on a mere technicality but the IRS official who made the determination to start the tax inquiry wasn’t ranked high enough in the agency to make that decision.  A decision to examine church records, according to law, “must be made by an official whose experience and level of political accountability will make it more likely that there will not be undue government intrusion into religious affairs,”  suggested the magistrate’s report and recommendation. 
“Due to concerns about the separation of church and state and the inherent tension in church-state relations, Congress clearly wanted the decision to investigate a church to be approved by a high-level Executive Branch official,” according to the stated report.

Pastor Hammond is a part of the so-called “prosperity gospel,” which teaches a life dedicated to Christ will result in spiritual and material blessings for its members.  Hammond owns homes and property worth millions of dollars.  He violated IRS rules when he publicly drew attention by endorsing U.S. Rep. Michele Bachmann, R.-Minn from the pulpit and he later apologized.  The IRS chose not to continue the inquiry into the church’s political activities. The IRS was interested in Hammond’s compensation and wanted the details of a relationship in which the church bought a jet for him.  Hammond leased the jet back to the church at a profit and this was questioned by a Washington, D.C. watchdog group.

According to Rotenberg she has no way of knowing if a higher ranking IRS official could restart the tax investigation into the church.  “It’s always within the IRS’s purview to initiate an inquiry of any church,” she said.  “But in order to do so, they are going to have to meet a specific threshold of evidence that would allow a high enough level official to decide such iniquiry is appropriate.”  “They didn’t meet that threshold now, and we don’t believe they will if they go forward.”

According to a report “Due to concerns about the separaton of church and state and the inherent tension in church state relations, Congress clearly wanted the decision to investigate a church to be approved by a high-level Executive Branch official.”

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