Preparing to battle with the Internal Revenue Service over the possible revocation of his church’s tax-exempt status, the Rev. Ed Bacon of All Saints Episcopal Church on Sunday faced a packed congregation and national media outlets to deliver a stirring defense of the rights of ministers to address political issues.

The sermon came in response to an IRS summons that was issued to All Saints officials on Friday, which sought church documents tied to a guest sermon delivered by Rector Emeritus George Regas two days before the 2004 presidential election.

In that sermon, Regas offered sharp critiques of President Bush’s stands on the Iraq War, abortion and poverty issues by imagining what Jesus Christ would say to Bush and his opponent, Sen. John Kerry, as the moderator of a debate between the candidates.

The IRS summons is tied to an investigation attempting to determine if Regas and All Saints broke rules that state neither a church nor its officials may publicly endorse a political candidate from the pulpit.

Bacon’s defense centers on the contention that Regas never directly endorsed either candidate in his sermon, which they hope will be buffered by the fact that the sermon used an allegorical setting to make its points.

“Ideally, the IRS should drop the case immediately. They are on the wrong side of the law and are misinterpreting the law,” said Bacon while addressing media members after All Saints’ 9 a.m. service. “My main concern is not whether we lose our tax-exempt status, but rather it’s the chilling effect on the pulpit that gives me my most passionate concerns. I feel I stand on behalf of all the others who don’t have the resources and support I clearly have.”

Indeed, that support was made loud and clear at the 11:15 a.m. service on Sunday, when Bacon received a sustained standing ovation as he began his sermon. The ovation came as soon as Bacon opened with a sly nod to any potential IRS agents in attendance.

“I want to begin this sermon by once again expressing my gratitude to the Internal Revenue Service. Those brothers and sisters really know how to shine a spotlight on a church and swell the number of worshippers,” said Bacon.

Bacon noted that the IRS had only approached church officials sporadically since its initial threat of an investigation in 2005, leading them to believe that the issue would pass without actual action. It was in November 2005 that All Saints officials attempted to start both written and oral communications with the IRS, but Bacon said that it took until July for the IRS to issue a letter requesting “a lengthy list of documents from us.”

Those requested documents are to include “every instance in which we mention any elected official or candidate in our worship” — which would result in an unmanageable avalanche of paperwork because of the fact that the church prays for President Bush by name at every service. As a result, church officials in August asked the IRS to be more specific in its request and reissue their demands in an administrative summons. That summons was finally delivered by an IRS agent last Friday afternoon.

That chain of events inspired Bacon’s most fiery comments of the sermon, as he railed against the notion that “the current administration of the IRS” seems to believe “that religious organizations should stay neutral when political concerns are involved.

“What that thinking totally misses is that we do not have a choice about whether or not to be neutral in the face of dehumanization, injustice and violence,” said Bacon. “Our faith mandates that always stopping short of endorsing or opposing political candidates, the church can neither be silent nor indifferent when there are public policies causing detriment to the least of these. … Neutrality, silence and indifference are not an option for us.”

Speaking to a group of reporters that included a crew from CNN after the 9 a.m. service, Bacon claimed that even Christian-right leaders have called him with supportive words from the polar-opposite end of the political spectrum. In addition, Democratic Congressman Adam Schiff and Rep. Walter B. Jones, R-NC, called for the IRS to justify its investigation of certain houses of worship throughout the country.

“We request the IRS to clarify its rules on political intervention so that tax-exempt organizations know what is and is not allowed,” the two lawmakers wrote on Monday in a letter to Treasury Secretary Henry Paulson and IRS Commissioner Mark Everson. “We are unclear as to why statements that solely take an opinion on issues of the day are grounds for revocation of a tax exemption.”

Bacon said that the next step for All Saints is for its elected board of governors to determine whether to comply with the IRS request or to fight the request and have the matter put before the judicial system. He said that decision would be made at a meeting later in the week, but it seemed clear that Bacon had already weighed the decision at hand.

“There is a clear advantage to taking this into the courts, where there’s a judge, a public venue, checks and balances and the right to appeal any decision,” said Bacon. “Otherwise we’re dealing with a single IRS commissioner.”

While Bacon was greeted with warm hugs and encouraging words from his parishioners after each service, one notable church member — actor Bradley Whitford, a former star of “The West Wing” — spoke at greater length about his feelings on the controversy.

“I was amazed when this first came up and thought it would go away. They’re interfering in free speech, because the sermon was very careful not to endorse a candidate. If religion is not about putting values in action then it’s about anesthesia, and I think there’s so much hypocrisy in this case,” said Whitford. “Politics is the vehicle that puts our values in action. It weakens you to be partisan, but you have to take a stand. Politicians spout that they’re Christian, but it’s a high standard and it’s up to churches to hold them up to those high standards.”