June 20, 2008 -- Few Americans would invite an investigation by the Internal Revenue Service, but that's exactly what Minnesota pastor Gus Booth wanted when he stood behind his pulpit and told his congregation God wanted them to vote Republican.

In an election where candidates openly discuss their faith and are regularly seen in churches, and a time when pastors' sermons lead the politics sections of newspapers, one might be excused for not knowing that it is illegal for a church to endorse or oppose a candidate for president.

But when Booth addressed the members of his Warroad Community Church one Sunday in May and told them, "If you are a Christian, you cannot support a candidate like Barack Obama or Hillary Clinton for president," he very much knew he was violating the law. He even wrote a letter to the IRS explaining what he had said and challenging the tax collection agency to do something about it.

Churches and other non-profit groups like charities and universities do not have to pay taxes. That exemption, however, comes with a price. Churches, and by extension the pastors who serve them in an official capacity, are not allowed to endorse or oppose political candidates.

Booth, 34, is one of several religious leaders who this year hope to challenge federal law by flouting the regulations about endorsing candidates from the pulpit — a move that could potentially cost them their tax-exempt status, creating financial ruin for many congregations.

The separation of church and state may be one of our democracy's most vaunted values, but its enforcement falls to one of our government's most derided institutions — the IRS.

First Amendment Protection?

Booth and other religious leaders who want to challenge the government believe their rights to freedom of speech and religion, enshrined in the First Amendment, permit them to say whatever they want, wherever they want. Those rights, they say, should trump a 54-year-old tax code.

"The government is trying to censor me and other religious leaders," Booth told ABC News. "I may be taking on the IRS, but the IRS has taken on the Constitution unchallenged since 1954. I feel like the only law that should dictate what I am allowed to say is the First Amendment."

"The gist of my speech was you can't support Hillary Clinton or Barack Obama because they support abortion and homosexual marriage, and the scripture vehemently opposes both. I didn't say vote for McCain, but I'm planning to," he said.

In addition to being a pastor, Booth is also a delegate to the Republican National Convention. But it was his Lord and Savior, he says, not his party bosses, who told him to literally make a federal case out of preaching a sermon.

"A month before I made the sermon I talked to the church leadership. I told them, 'If we do this we could lose our tax exempt status. Are you prepared for that?' We spent a week in prayer, and I felt God was telling me to make that speech."

Booth said despite alerting the IRS to his sermon, he has yet to hear from the agency. The IRS would not comment to ABC News on any specific investigation.

Watchdog Group Weighs In

Last week, Americans United for the Separation of Church and State, a watchdog group sent a letter to the IRS also asking them to investigate Booth.

Both the IRS and Americans United say the agency in recent years has increased the number of investigations it conducts on organization suspected of abusing their tax-exempt status and the speed with which it recommends action.

In 2006, the IRS received 237 complaints and selected 100 groups — 44 churches and 56 nonchurches — for examination. More than half of those cases remain under investigation, according to IRS statistics.

"However, the IRS did substantiate improper political activity in 26 cases and issued written advisories. So far, there are no revocation recommendations," according to an agency report on the statistics.

In 2004, the IRS selected 110 cases for examination and revoked the tax-exempt status of five organizations. Of those five organizations, none were churches.

The last church to have its tax-exempt status revoked was the Church at Pierce Creek near Binghamton, N.Y., in 1992.

The Church took out an ad in 1992 that read: "The Bible warns us to not follow another man in his sin, nor help him promote sin — lest God chasten us … How then can we vote for Bill Clinton?"

That ad, like a speech from the pulpit, is a violation of section 501(c)(3) of the tax code, according to the IRS.

"Generally, the law passed in 1954 prohibits any tax-exempt organization from participating on behalf or in opposition to any candidate," said IRS spokesperson Nancy Mathis.

Equal Time Behind the Pulpit

Legally, Mathis said, candidates are allowed to speak at churches, much like Sen. Barack Obama, D- Ill., did over the weekend in Chicago when he delivered a sermon about fatherhood. Churches who host candidates, however, are supposed to invite the opposition candidate as well.

In 2007, the IRS investigated and dropped charges against United Church of Christ following a conference in which Obama was allegedly endorsed during an introduction. Obama formerly belonged to Trinity Church, a member of United Church of Christ, but split with the church following controversial comments by his old pastor Rev. Jeremiah Wright.

"There is a very simple test religious leaders can use to determine if they're violating the law," said Rev. Barry Lynn, executive director of Americans United for the Separation of Church and State. "Ask yourself: 'Is what I'm doing intended to help someone's candidacy?' If the answer is 'yes,' don't do it."

"Tax exemption is not a right; it's a privilege that comes with certain restrictions," Lynn said.

According to Lynn, Booth's "free speech" argument is specious because taxpayers should not have to subsidize pastors' political activities they do not agree with.

Other Pastors Join Booth

Booth is not the only pastor challenging the IRS this year.

The Alliance Defense Fund, a Christian advocacy group based in Scottsdale, Ariz., is enlisting ministers around the country to endorse candidates from their churches' pulpits on Sept. 28.

"Pastors on that day will evaluate candidates in light of scripture," said Erik Stanley, senior legal counsel for the group. "Our hope is that the IRS will initiate investigations and we can bring this into the federal courts."

Churches, he said, are doubly protected by the First Amendment to make political speeches, because it protects both free speech and freedom of religion.

"Churches have constitutional rights and special status by virtue of being churches. This isn't about political speech, it is about religious speech. The Bible and scripture applies to every aspect of life, including who we elect."

Both the Democrats and Republicans recognize how important "faith voters" will be in this year's presidential election, and each is working to court religious groups.

Given the sensitive legal and political ramifications of the issue, officials from both parties would speak only on background.

"We don't advise churches because they're tax exempt organizations. We do advise our volunteers and coalitions that anything they do related to their religion must be done in their volunteer capacity — not through the church," said a Republican National Committee official.

The Democrats this year are courting religious voters like never before and will open this summer's convention, for the first time, with a prayer meeting.

"There is a distinction between the pastor and the pulpit," said a Democratic Party official. "We've made a significant effort to reach out to faith voters this year, but we're always making sure people know the law and the guidelines."