Reasoning
Justice Thurgood Marshall began the majority opinion with a discussion of the legislative history of the "contribution or gift" limitation as described in IRC §170(c). When the tax bill was enacted in 1954, Congress distinguished between unrequited payments and payments made in return for goods and services. Specifically, the gift characterization was deemed to only apply "if there were no expectation of any quid pro quo..." In later decisions, the quid pro quo analysis was expanded to also apply to charitable contributions.
Hernandez and other taxpayers argued that the "quid pro quo" determination did not apply to this situation because the benefit they were receiving through the auditing and training was purely religious. The Court emphasized that IRC §170(c) clearly states that donations to religious organizations are only deductible if they are contributions or gifts, regardless of the expectations underlying the payments. The Court hesitated to broaden the scope of the deduction to any payments designed to achieve a religious benefit, since that could open the door to deductions such as those for parochial school tuition or payments to church-affiliated hospitals. The Court noted that refraining from characterizing the services provided by religious institutions prevented the government - the IRS and court system - from effectively monitoring the practices of a church.
Read more about this topic: Hernandez V. Commissioner
Famous quotes containing the word reasoning:
“Education is a necessity, it helps to understand life. Like that compagnero in Cuba who talked about politics, back when they were on strike. He knew many things, that hijo de puta, and he unraveled the most confusing situations in a marvelous way. You could see each point in front of you on the line of his reasoning like rinsed laundry set up to dry; he explained things to you so clearly that you could grasp it like a good hunk of bread with your hand.”
—Jacques Roumain (1907–1945)
“We put [young children] into kindergarten where their reasoning powers are ruined; or, if we can afford it, we buy Montessori outfits that were invented for semi-imbeciles in Italian slums; or we send them to outdoor schools and give them prizes for sleeping.”
—Katharine Fullerton Gerould (1879–1944)
“For this is one of the ancientest laws among them; that no man shall be blamed for reasoning in the maintenance of his own religion.”
—Sir Thomas More (1478–1535)