Sponsors (14)
This bill strengthens religious organizations' and employers' protection to obtain tax benefits and federal funding and to preference co-religionists in hiring, trading expanded religious liberty protections and funding predictability for reduced nondiscrimination safeguards for LGBTQ+ people and employees and increased risk of taxpayer-supported discriminatory practices and administrative/legal costs.
Religious and faith-based nonprofits can retain or obtain federal tax-exempt status even if they hold or express beliefs about marriage, sexuality, or gender identity that conflict with public policy; the bill broadens what counts as a "religious belief" and reduces the risk of IRS denials, creating more predictable access to 501(c) benefits for those organizations.
Religious employers are allowed to prefer co-religionists in hiring while still receiving federal grants, loans, contracts, or cooperative agreements, and statutory religious exemptions/defenses (e.g., Title VII, ADA, RFRA, First Amendment) are preserved for those funding decisions.
The bill may lower the immediate risk of funding disruptions and certain lawsuits for religious organizations by creating statutory protections in funding decisions, giving those organizations greater assurance when applying for federal funds.
LGBTQ+ people may face allowed discriminatory policies from tax-exempt organizations without those organizations losing tax benefits, reducing recourse and protections for people harmed by discriminatory practices.
Taxpayers could indirectly subsidize organizations whose practices conflict with nondiscrimination public-policy goals, meaning public funds and tax benefits may support entities whose activities some taxpayers find objectionable.
Employees and job applicants may have reduced protection from employment discrimination if religious employers receiving federal funds can lawfully prefer co-religionists, potentially limiting job opportunities and legal remedies for affected workers.
Based on analysis of 3 sections of legislative text.
Treats beliefs about marriage, sexuality, and gender identity as irrelevant to deciding "religious purpose" for tax exemption and bars federal agencies from penalizing religious employers for hiring consistent with their religious standards.
Changes federal rules so that religious beliefs about marriage, sexuality, or gender identity cannot be used against an organization when deciding whether it has a “religious” purpose for tax-exempt status, and bars federal agencies from penalizing religious employers for employment practices that follow their religious standards. The tax change applies to taxable years beginning after December 31, 2025; the bill also makes clear that existing legal defenses and exemptions (Title VII religious-organization and ministerial exemptions, the ADA defense, RFRA, and the First Amendment) remain available.
Introduced March 26, 2026 by Blake D. Moore · Last progress March 26, 2026