Jennifer M. Smith (Florida A&M) has published Morse Code, Da Vinci Code, Tax Code and … Churches: An Historical and Constitutional Analysis of Why Section 501(c)(3) Does Not Apply to Churches, 23 J.L. & Pol. 41 (2007). Here is the Conclusion:

From an historical and constitutional perspective, § 501(c)(3) was never intended to apply to churches. The application of this section of the Code to churches ignores history and tramples churches’ rights under the First Amendment. Constitutional red flags should be raised in the government’s regulation of churches’ expression, but not the churches’ expression itself. The government can say what is deductible and what is not, but it cannot dictate what is religious. If the government is concerned with what is deductible, then it should address tax deductions, not speech content. The government also should not regulate speech content through taxation. As one commentator has noted, “It should not be for the state to label as electioneering, endorsement, or lobbying what a religious community considers evangelism, worship, or witness.” Instead of trying to determine the parameters of religion, the courts, Congress, and the federal government should focus on ensuring that § 501(c)(3) is not being abused by donors — wealthy donors — seeking to use it for their personal agendas. After all, that was the original purpose behind the enactment of the political activity restrictions in § 501(c)(3).