The Supreme Court on Thursday sided with a Wisconsin-based Catholic charity group in a case centered on unemployment tax credits for religious institutions – delivering a victory for faith-based institutions, who argued that the state's decision had violated the religious clauses under the First Amendment. 

In a unanimous opinion, the justices agreed that the state had engaged in an "unnecessary entanglement" in attempting to define whether religious groups should be entitled to an otherwise-available tax exemption based on the state’s criteria for religious behavior.

"When the government distinguishes among religions based on theological differences in their provision of services, it imposes a denominational preference that must satisfy the highest level of judicial scrutiny," Justice Sonia Sotomayor said, writing for the majority.

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