September 24, 2007 | 10:33 am

All Saints cleared by IRS

Posted by Brad A. Greenberg

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Remember all that hub-bub in late 2005 when the Internal Revenue Service said it was investigating an anti-war sermon delivered at All Saints Episcopal in Pasadena? Well yesterday, congregants were told the liberal church is in the clear. Sort of.

The investigation is over, the church did not lose its tax-exempt status, but the IRS still said the speech—seen by some as supporting Kerry over Bush, which non-profits can’t do—was illegal. The LA Times reports that the rector wants a clarification and an apology. Good luck.

“To be sure, we are pleased that the IRS exam is over,” the Rev. J. Edwin Bacon Jr. said in his 9 a.m. sermon, which was interrupted several times by applause. “However, the main issue of protecting the freedom of this church and other religious communities to worship according to the dictates of their conscience and core values is far from accomplished.”

Bacon predicted that the vague, mixed message from the IRS after its nearly two-year investigation of the All Saints case would have a continued “chilling effect” on the freedom of clerics from all faiths to preach about moral values and significant social issues such as war and poverty.

Although the church no longer faces the imminent loss of its tax-exempt status, All Saints has “no more guidance about the IRS rules now than when we started this process,” the rector said. He said the church would continue its struggle with the IRS, which he said so far had cost the 3,500-member congregation about $200,000.

(A quick note: The next line of the article—“One of Southern California’s largest and most liberal congregations”—is so far from accurate its comical. All Saints is both prominent and liberal, but certainly its not at the extreme end of the spectrum. But more hyperbolic is the “largest” claim. In the era of 7-Eleven mega-churches, a 3,500-member congregation seems quaint.)