Hobby Lobby Decision Strengthens Religious Exemption Claims

The U.S. Supreme Court has ruled that the government cannot require Hobby Lobby, in violation of its religious beliefs, to provide abortion-inducing contraceptives in its health plan. In reaching this conclusion, the Court adopted nearly all of the positions for which we argued in a “friend of the court” (amicus) brief we filed with the Court to protect the religious liberty interests of nonprofit religious organizations.

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The Upcoming Hobby Lobby Decision’s Impact on Religious Exemptions

Within the next several days, the U.S. Supreme Court will issue its decision regarding whether the government can require Hobby Lobby to provide abortion-inducing contraceptives in its health plan, notwithstanding Hobby Lobby’s religious objection to abortion.  In determining whether the law can be applied to Hobby Lobby, the Supreme Court must decide whether religious exercise rights should be applied broadly or narrowly.

The Supreme Court’s decision will likely have important implications for nonprofit religious organizations.  Most directly, the decision may determine whether such organizations can claim a religious exemption from the contraceptive coverage mandate. More generally, the decision may determine the scope of other important religious exemptions.

Many religious organizations have a vital interest in preserving their rights to:

  1. employ fellow believers as they deem necessary;
  2. carry out their ministry activities in accordance with their beliefs (e.g., with respect to marriage and sexual conduct); and
  3. qualify for religious tax exemptions.

In our current legal climate, religious organizations must increasingly rely on broad religious exemptions to exercise these rights.  If only narrow religious exemptions are available, then many religious organizations will be required to sacrifice their religious character in order to accomplish their religious mission.

Although the Supreme Court’s decision regarding Hobby Lobby will not expressly determine whether broad religious exemptions apply in each of these areas, it very likely will set a legal foundation to support either broad or narrow exemptions.  For this reason, we filed an amicus brief with the Supreme Court in which we argued for broad religious exemptions.  A copy of this brief may be accessed by clicking here.

After the Supreme Court issues its decision, we will provide an analysis of the decision’s actual impact on religious organizations.  Please feel free to contact us if you have any questions.


The Contraceptive Mandate: Strategic Planning for Religious Organizations

Under the Patient Protection and Affordable Care Act (“ACA”), employers with group health plans must provide preventive health services without charging a co-pay, coinsurance payment, or a deductible.  On August 1, 2011, the Department of Health & Human Services (HHS) adopted guidelines outlining the required preventive health care for women. That guidance requires coverage for all FDA-approved contraceptive services, including the “morning after” pill and the “week after” pill. When this HHS guidance was initially issued, many religious organizations objected to the contraceptive coverage requirement on the ground that this coverage was in direct conflict with their religious beliefs. HHS subsequently amended the regulations to exempt entirely organizations described in Internal Revenue Code sections 6033(a)(1) and 6033(a)(3)(A)(i) or (iii). These sections include organizations that may be classified for tax code purposes as churches, conventions or associations of churches, integrated auxiliaries or religious orders.  For those objecting nonprofit religious organizations that do not qualify for the church employer exemption, HHS has recently finalized the rules for an “accommodation.”

For more information please view the Bryan Cave Alert


Section 107 Parsonage Allowance Exclusion Limited to One Home

The United States Court of appeals for the Eleventh Circuit Court recently ruled that the parsonage allowance exclusion from gross income contained in section 107 of the Code is limited to the rental value of providing a single home. Commissioner v. Driscoll, 2012 U.S. App. LEXIS 2403 (11th Cir. 2012). The case involved a minister who claimed the parsonage allowance for both his principle residence and his lake house. In addition to turning back a minister’s expansive use of the parsonage allowance, the Eleventh Circuit’s decision addressed important issues related to the interpretation of ambiguous provisions of the Code. (more…)

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