The following is a list of websites that address the loss of tax exempt status. I don’t know that there is a smoking gun that would convince a member, but the crowd here should be able to read and enjoy:
A note about tax-exempt status: Religious entities can pretty much say what they want and not lose tax-exempt status. However, it is very different for Religious Educational entities:
BYU – Ricks – CCH The IRS was putting pressure on private schools to stop discrimination with the US vs. Bob Jones University. This ruling would directly affect BYU, Ricks, CCH and other US Mormon owned schools. These schools are organized under separate nonprofit corporations which are owned by the Corporation of the President of the Church of Jesus Christ of Latter Day Saints. As you can see from the following excerpts from case documents, the Bob Jones University case was directed at educational nonprofits. This would have affected the Morg, but not the core corporation.
On January 12, 1970, a three-judge District Court for the District of Columbia issued a preliminary injunction prohibiting the IRS from according tax-exempt status to private schools in Mississippi that discriminated as to admissions on the basis of race. Green v. Kennedy, 309 F. Supp. 1127, appeal dism’d sub nom. Cannon v. Green, 398 U.S. 956 (1970). Thereafter, in July 1970, the IRS concluded that it could “no longer legally justify allowing tax-exempt status [under 501(c)(3)] to private schools which practice racial discrimination.” IRS News Release, July 7, 1970, reprinted in App. in No. 81-3, p. A235. At the same time, the IRS announced that it could not “treat gifts to such schools as charitable deductions for income tax purposes [under 170].” Ibid. By letter dated November 30, 1970, the IRS formally notified private schools, including those involved in this litigation, of this change in policy, “applicable to all private schools in the United States at all levels of education. (emphasis added) ” See id., at A232.
BYU, Ricks and CCH probably received this letter.
On June 30, 1971, the three-judge District Court issued its opinion on the merits of the Mississippi challenge. Green v. Connally, 330 F. Supp. 1150, summarily aff’d sub nom. Coit v. Green, 404 U.S. 997 (1971). That court approved the IRS’s amended construction of the Tax Code. The court also held that racially discriminatory private schools were not entitled to exemption under 501(c)(3) and that donors were not entitled to deductions for contributions to such schools under 170. The court permanently enjoined the Commissioner of [461 U.S. 574, 579] Internal Revenue from approving tax-exempt status for any school in Mississippi that did not publicly maintain a policy of nondiscrimination.
The IRS’s 1970 interpretation of 501(c)(3) was correct. It would be wholly incompatible with the concepts underlying tax exemption to grant tax-exempt status to racially discriminatory private educational entities. Whatever may be the rationale for such private schools’ policies, racial discrimination in education is contrary to public policy. Racially discriminatory educational institutions cannot be viewed as conferring a public benefit within the above “charitable” concept or within the congressional intent underlying 501(c)(3). Pp. 592-596.
The Government’s fundamental, overriding interest in eradicating racial discrimination in education substantially outweighs whatever burden denial of tax benefits places on petitioners’ exercise of their religious beliefs. Petitioners’ asserted interests cannot be accommodated with that compelling governmental interest, and no less restrictive means are available to achieve the governmental interest. Pp. 602-604.
Corporate Sole is the safest organization for a racist 501(c)(3). The Corporation of the President of the Church of Jesus Christ of Latter day Saints is a Corporate Sole.
Other Corporate Sole corporations:
Harrie A. Schmidt, Jr., state chairman of the Populist Party, which is run nationally by Ku Klux Klan leader Kim Badynski.
Glen Stoll, a Populist Party member who also is involved in the Embassy of Heaven, an anti-government religious organization based in Sublimity, Ore. Stoll was the leader of the Liaison Group, which called for militia members across the Northwest to assist Whatcom County constitutionalist Donald Ellwanger in a 1995 standoff with the IRS.
Doyal Gudgel, also active in the Liaison Group, but best known for organizing events in Seattle for David Irving, a British man who denies the Holocaust happened.
Despite huge holes in the secretary of state’s database, Lunsford was able to spot about 50 corporation soles associated with white supremacists, militiamen, constitutionalists or people who deny the Holocaust. He discovered some supporters of the Christian Identity, anti-government group Posse Comitatus had set up “soles” as early as 1979.
David Ransom: Now up until 1978 I understand Blacks were not allowed to be priests in your Church?
Gordon B. Hinckley: That is correct. Although we have Black members of the Church. They felt that they would gain more in this Church than any other with which they were acquainted and they were members of the Church. In 1978 we (the president of the Church) received a revelation under which all worthy men would receive all the blessings of the Church available to them as well as to any others. So across the world now we are teaching the Gospel to Blacks, Whites, everyone else who will listen.
DR: So in retrospect WAS THE CHURCH WRONG IN THAT?
GBH: NO I DON’T THINK IT WAS WRONG. It things, various things happened in different periods. There’s a reason for them.
DR: WHAT WAS THE REASON FOR THAT?
GBH: I DON’T KNOW WHAT THE REASON WAS. But I know that we’ve rectified whatever may have appeared to be wrong at that time.