They just have to give up their tax-exempt status.
Instead what we find is the situation where, for example, the Bellevue Baptist Church in Cordova, Tenn., for example, tried to find a way to support candidates in their local election without actually coming out and supporting them.
The issue of employee rights of gay, lesbian and transgendered city employees has come before the Memphis city council and is likely to come up again and the church would like to have people on the council who will oppose those rights. The Baptist church tried to end-run the tax law by urging its members to "become fully informed" about the upcoming election, and sent people to Family Action of Tennessee, a Focus on the Family affiliate. Family Action of Tennessee endorses three candidates who "have stood strong for pro-family values," i.e., opposed protecting gay, lesbian and transgendered employees when it came up before the council.
According to the church, this is "IMPORTANT PRO-FAMILY INFORMATION." Their website provides a direct link to the the web site endorsing the city candidates.
This is an endorsement, and being a "one-step-removed" endorsement doesn't really change that. Endorsing an endorsement is also an endorsement. As Americans United for the Separation of Church and State points out, this is specifically forbidden by the tax law. A lot of churches skate just to the one side of the line, by putting out "voter guides," or get-out-the-vote drives which are technically non-partisan enough for there to be a barely plausible case that specific candidates aren't being supported exactly. What the Baptist church in Cordova, Tenn. did is on the other side of that line. It's not the clever maneuver the church apparently thinks it is, but a violation of federal law.
You're not allowed to do this if you're 501(c)(3) tax exempt.
According to the IRS:
"Political campaign intervention includes any and all activities that favor or oppose one or more candidates for public office. The prohibition extends beyond candidate endorsements. Contributions to political campaign funds or public statements of position (verbal or written) made by or on behalf of an organization in favor of or in opposition to any candidate for public office clearly violate the prohibition on political campaign intervention. Distributing statements prepared by others that favor or oppose any candidate for public office will also violate the prohibition. Allowing a candidate to use an organization’s assets or facilities will also violate the prohibition if other candidates are not given an equivalent opportunity."
You are allowed to do this, though. Churches can be as political as they want.
Grant that, for Bellevue Baptists, electing these councilmen is of the utmost importance. Assume that, for them, it is a part of their faithful Christian witness, the exercise of their religion, to oppose gay rights in Memphis. There's an argument to be made (and which has been made, in the political activation of evangelicals), that they have to get involved in politics, being compelled by their understanding of God and of the Bible.
For some, it's a matter of "pulpit freedom."
There is a legitimate case, there.
Just not if those pulpits are also going to be tax free. If they want to be something besides 501(c)(3), then they can do whatever political advocation and an agitation they feel they need to do.
It's not an issue of a wall between the Tenn. Baptists and the city elections. It's an issue of agreeing to forgo some specific activities, such as making a profit and influencing politics, in exchange for a special arrangement that allows you to give tax deductions to donors. The church just has to make a choice: money or politics?