Community Worship Fellowship loses 501(c)(3) status after funds benefited insiders
Community Worship Fellowship v. United States, No. 19-352, 2025 BL 380420 (Fed. Cl. Oct. 23, 2025), Court Opinion
The Court of Federal Claims upheld the IRS revocation of Community Worship Fellowship’s 501(c)(3) and church status for 2013 to 2016 because net earnings inured to insiders, and there was no genuine dispute of material fact.
Holding
The court issued summary judgment in favor of the government, confirming that the IRS properly revoked Community Worship Fellowship’s tax-exempt status under section 501(c)(3) and its church designation for the relevant period.
The court reviewed the case de novo, presuming the IRS's factual findings to be correct, and identified a clear private benefit to members of the founding family.
Why It Matters
Confirms that any private inurement, even if small, defeats 501(c)(3) status.
Reinforces that compensation set and controlled by insiders without independent safeguards can be treated as inurement.
Clarifies that an entity cannot qualify as a church for tax purposes if it does not meet 501(c)(3) requirements.
Shows how courts handle section 7428 revocation challeng…
