From the National Council of Nonprofits:
Nonprofit Nonpartisanship, Court and Commission Hearings Held
A Texas federal court heard oral arguments on Nov. 25 in Dallas, Texas on National Religious Broadcasters v. Internal Revenue Service (IRS) on the question of whether to approve or deny a consent decree between two churches and the IRS that would essentially bar the federal government from enforcing a federal law known as the Johnson Amendment that has protected nonprofits for more than 70 years. While the case only applies to two churches, the court’s decision could open the door to removing the federal safeguard for houses of worship or more broadly to all charitable nonprofits. Following the hearing, parties filed another round of briefs in response to the judge’s questions on constitutional issues under the First and Fifth Amendments, procedural requirements, the Anti-Injunction Act, and the Religious Freedom Restoration Act, among other issues. Last Friday, the court denied a motion by American’s United to intervene in the case, but did not issue a final decision on the merits, which is expected in the coming weeks. See NCN’s press statement.
The Religious Liberty Commission created by the Trump Administration also recently held a hearing in Dallas on religious liberty issues, including the Johnson Amendment. In response, NCN, Council on Foundations, Independent Sector, and United Philanthropy Forum filed joint testimony to underscore the importance of maintaining and preserving the Johnson Amendment to keep charitable nonprofits, houses of worship, and foundations focused on mission and preserving public trust.
Undermining nonprofit nonpartisanship will harm the nonprofit sector. Charitable nonprofits, including houses of worship, are among the few remaining trusted spaces where people come together across political, religious, and cultural divides to solve local problems. The public’s trust in charitable nonprofits is rooted in one simple principle: nonprofits exist to serve the public good, not partisan politics.
DOJ Directs More Investigations Into Nonprofits
U.S. Attorney General Bondi recently directed federal law enforcement agencies to increase investigations into nonprofits with alleged ties to Antifa or domestic terrorism. The U.S. Department of Justice (DOJ) also asked the Federal Bureau of Investigation to compile a list of possible targets for investigation. The DOJ order was issued as part of a larger effort to carry out a presidential memorandum signed in September 2025, instructing federal agencies to investigate, prosecute, and disrupt nonprofits the Administration claims without evidence are supporting or funding domestic terrorism.
Earlier this year, DOJ launched a baseless criminal investigation into the Open Society Foundations, an unprecedented and direct assault on the nonprofit sector. These actions threaten to target nonprofits that oppose the administration’s priorities and ideology. Learn more about attacks on freedom of speech and what nonprofits need to know.
Federal FastView
- Anti-Discrimination Rule Finalized: The DOJ finalized a rule to “eliminate disparate-impact liability” and implement an executive order, Restoring Equality of Opportunity and Meritocracy. Disparate impact policies historically prohibited local governments and organizations receiving federal funding from disproportionately harming people of color and discriminating on the basis of race, color, or national origin under the Civil Rights Act of 1964. The rule, which was issued without the normally required notice and comment period, took effect last week.
- Proposed Changes to Public Charge Rule: The U.S. Department of Homeland Security (DHS) published a proposed regulation to make changes to the public charge rule that could discourage immigrants from using public benefits like the Supplemental Nutrition Assistance Program (SNAP) or Medicaid. The public charge rule allows immigration officials to give greater weight to applicants’ medical history, income levels, and use of public assistance in determining whether to grant lawful immigration status. The proposed new rule would rescind a 2022 rule that guaranteed that noncash public benefits like SNAP and Medicaid could not be considered in determining whether an individual would be granted lawful immigration status. Comments are due by Friday, Dec. 19, 2025.
- Legislation to Add Citizenship Question Considered: The House Oversight and Government Reform Committee held a markup on Dec. 2 to consider the Equal Representation Act (H.R. 151), which would add a citizenship question to the decennial census. The U.S. Supreme Court rejected a similar attempt in 2019. NCN strongly opposes any attempt to include a citizenship question as it would intimidate respondents resulting in an unfair, inaccurate, and incomplete count and adversely impact funding and nonprofit sustainability, data and nonprofit effectiveness, and democracy and the public’s trust in government.
- IRS Proposes Rule for Scholarship Granting Organizations: The Treasury Department and IRS are seeking comments on a proposed rule that would implement a new federal tax credit for individual contributions to scholarship granting organizations (SGOs) serving elementary and secondary school students, under H.R. 1. The legislation requires each state to provide the IRS with a list of SGOs that are eligible under the law, and Treasury and the IRS are seeking feedback on implementing their proposed process for states to certify SGOs, recordkeeping requirements, and rules for single-state and multistate SGOs. Comments are due by Dec. 26, 2025.
- Federal Judge Questions Use of SAVE Database for Voting: Last month, a federal judge challenged the use of and changes to the Systematic Alien Verification for Entitlements (SAVE) database by the Trump administration to enable bulk-checking of citizenship status for registered voters, but declined to block the changes at this time. Under the revamped system, states can check citizenship status and upload voter data, and search using social security numbers. Both capabilities are major expansions from SAVE’s prior use for public benefit eligibility verification. The judge raised concerns about whether the actions exceed the government’s authority for the purposes of SAVE.
- DOGE Quietly Closes: Major news outlets report that the Department of Government Efficiency (DOGE) has disbanded eight months ahead of schedule. Launched in January 2025, DOGE sought major layoffs of federal workers, dramatic cuts to federal funding, and new terms and conditions on federal grants. In April 2025, DOGE attempted to deploy a team to the Vera Institute, an independent nonprofit, prompting deep concerns from NCN and others. Several lawsuits challenged the creation and status of DOGE as a government agency, its access to information, circumvention of the Freedom of Information Act (FOIA), and federal layoffs, among many other actions. For updated information, see NCN’s Chart on Executive Orders Affecting Charitable Nonprofits.
- Bipartisan Push for the Older Americans Act Nutrition Program: In late November, Reps. Buchanan (R-FL) and Bonamici (D-OR) led a letter to the House Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies to “include emergency supplemental funding for the Older Americans Act (OAA) Nutrition Program in the FY 2026 government funding bill.” The letter highlights that nearly 2.5 million eligible older adults are not receiving OAA Nutrition Program Services, and the challenges Meals on Wheels America faces in keeping up with demands for services.