Overview

• The Supreme Court unanimously reversed the Wisconsin Supreme Court’s 2024 decision that Catholic Charities Bureau of the Diocese of Superior did not qualify for a religious exemption under state unemployment tax law.
• Justice Sonia Sotomayor wrote that Wisconsin’s denial of the exemption imposed a prohibited denominational preference and violated the First Amendment’s free exercise clause.
• The case focused on a Catholic charity providing services to people of all faiths without proselytizing that had long been treated as secular by state authorities.
• The Trump administration filed a friend-of-the-court brief arguing that sincere religious motivations, rather than proselytizing, should determine eligibility for tax exemptions.
• The ruling may encourage other religiously affiliated organizations to seek similar exemptions and prompt states to reassess their unemployment insurance programs.