A Jewish couple's bid to take a tax deduction they say the Internal Revenue Service reserves only for members of the Church of Scientology is getting a friendly reception from a federal appeals court, increasing the possibility of a ruling that could create a tax break for taxpayers of many religions who pay tuition to religious schools.
During arguments on the case this week, three judges who ride the 9th Circuit Court of Appeals expressed deep skepticism of the IRS's position that the way the agency treats Scientologists is irrelevant to the deductions the Orthodox Jews, Michael and Marla Sklar, took for part of their children's day school tuition and for after-school classes in Jewish law.
"The view of the IRS is it can unconstitutionally violate the Constitution by establishing religion, by treating one religion more favorably than other religions in terms of what is allowed as deductions, and there can never be any judicial review of that?" Judge Kim Wardlaw asked at the court session Monday in Pasadena, Calif.
"That is not at all what I said," a Justice Department lawyer representing the IRS, Ellen Delsole, said.
"That's the bottom line," Judge Wardlaw and a colleague on the panel, Harry Pregerson, both replied. "This does intrude into the Establishment Clause," Judge Wardlaw added.
At about the time of that deal, the IRS agreed to allow Scientologists to deduct at least 80% of the fees paid for "religious training and services."
The Sklars took similar deductions for religious education on their returns for the early 1990s, without challenge by the IRS. However, the IRS rejected their deductions for 1994 and beyond.
"You tell us you don't know anything either, but you read the Wall Street Journal," Judge Pregerson said to Ms. Delsole. She said that even if the benefit for Scientologists went too far, the solution was not to give it to "one taxpayer and one more religion."
"That's your best argument: two wrongs don't make a right," the third judge on the case, Ronald Leighton, said. He called the agency's refusal to explain its agreement with the Scientologists "a frustration that is hard to get beyond."
Ms. Delsole warned the court that the IRS would have difficulty resolving tax disputes if it could be forced to justify those deals in cases involving other taxpayers. "Every person who can find out about it from any other religious group is going to come in and want the same thing and that would really tie the IRS's hands," she said.
As we are all well aware, if average Joe and Jane American took this tack we would quickly find ourselves being held guilty of contempt of court and would promptly be jailed till we recanted of our wicked ways. Apparently, the same rules do not apply where gubbmint lawyers are concerned. They can show all the contempt they wish as long as it is in pursuit of making their case. So much for equal treatment, eh?
I do wish the Sklars the best of luck in seeking justice against the IRS. They're likely to need it, regardless of the outcome of their case. The IRS and their DoJ allies will draw this out for years and take it all the way to the Supreme Court, if necessary. The unfortunate aspect is that the 9th Circuit is the most overturned court in the country, even when they're right. All taxpayers should be treated equal, while the onerous tax laws are enforced. Equal rights mean just that. Equal.
Libertarian, IRS, Scientology, Religion, Equal Rights