The epistle is addressed to "the twelve tribes which are scattered abroad". This naturally leads one to think of Jews living outside the land of Palestine. Since the Assyrian and Babylonian captivities, many Jews were scattered throughout different nations. While Jews, the epistle makes it clear that they were also brethren in the Lord, i.e., they were Jewish Christians. Nineteen times James calls them "brethren" and at least one time he definitely means those who were brethren "in the Lord".
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