The Fair Treatment of Religious Organizations Act of 2026 amends federal tax law to broaden protections for religious organizations seeking tax-exempt status. The bill changes how the Internal Revenue Service evaluates whether an organization qualifies as religious, preventing the agency from denying tax-exempt status based on an organization's beliefs or practices regarding marriage, sexuality, or gender identity, even if those beliefs conflict with law or public policy. The legislation also prohibits federal agencies from discriminating against or disadvantaging religious employers that receive federal grants, loans, or contracts based on their employment practices tied to religious beliefs and standards. The changes apply to tax years beginning after December 31, 2025. The bill would affect religious organizations, educational institutions, and religious employers that receive federal funding or pursue tax-exempt status.