Supreme Court Case May Change Tax Rules for Religious Organizations

What’s Happening:
The U.S. Supreme Court will hear a case Monday that could change unemployment tax laws for over a million workers at religiously affiliated organizations. At the center is Catholic Charities Bureau in Wisconsin, which argues it should be exempt from paying unemployment taxes because of its religious ties. The state disagrees, saying that helping the needy doesn’t count as a religious activity.

Why It Matters:
If the Court sides with Catholic Charities, many religiously affiliated hospitals, schools, and charities might stop paying unemployment taxes. Critics warn this could cost workers their benefits and let some groups avoid taxes unfairly.

Key Arguments:
Catholic Charities says the state violated its First Amendment rights by denying a tax exemption. Wisconsin argues exemptions should depend on what an organization actually does—not just its religious label. Legal experts warn the case could allow abuse if groups can claim religious status without oversight.

What’s Next:
A decision is expected by June. The outcome could reshape how the government handles religious exemptions and impact both taxpayers and workers nationwide.