2020_010_A
Support the Café
Search our site

Clergy housing tax exemption struck down

Clergy housing tax exemption struck down

Wisconsin State Journal reports that a federal judge has ruled that clergy housing allowances can no longer be tax exempt:

A federal judge has found unconstitutional a law that lets clergy members avoid paying income taxes on compensation that is designated part of a housing allowance.

The decision Friday by U.S. District Judge Barbara Crabb could have far-reaching financial ramifications for pastors, who currently can use the untaxed income to pay rental housing costs or the costs of home ownership, including mortgage payments and property taxes.

“It’s a really big deal,” said Annie Laurie Gaylor, co-president of the Madison-based Freedom From Religion Foundation, which filed the lawsuit. “A church currently could pay a minister $50,000 but designate $20,000 of it a housing allowance so that only $30,000 would be taxed as salary.”

Read it all here.

0 0 vote
Article Rating
Facebooktwitterpinterestlinkedinmail

Café Comments?

Our comment policy requires that you use your real first and last names and provide an email address (your email will not be published). Comments that use non-PG rated language, include personal attacks, that are not provable as fact or that we deem in any way to be counter to our mission of fostering respectful dialogue will not be posted.

13 Comments
Newest
Oldest Most Voted
Inline Feedbacks
View all comments
Marshall Scott

I noted in the linked response from the Freedom From Religion folks that the decision has been stayed pending expected appeals. That also doesn’t preclude new legislation. I won’t lose sleep over this one way or another. That said, I do go back and forth in my own reflection whether my opportunity to take housing allowance toward payroll taxes (note: not against Self Employment Tax (that is, Social Security and Medicare, for which my housing allowance is income) is an accommodation for community benefit or a government support for being religious.

Paul Woodrum

How does this apply to retired clergy who, under Church Pension rules, can cliam part or all of their pension as a tax exempt housing allowance?

Paul Powers

It should be noted that the ruling applies only to clergy who own or rent their own residences. It does not apply to clergy who live in a residence provided by the church.

Paul Powers

It should be noted that the ruling applies only to clergy who own or rent their own residences. It does not apply to clergy who live in a residence provided by the church.

John B. Chilton
Facebooktwitterrss
Support the Café
Past Posts

The Episcopal Café seeks to be an independent voice, reporting and reflecting on the Episcopal Church and the Anglican tradition.  The Café is not a platform of advocacy, but it does aim to tell the story of the church from the perspective of Progressive Christianity.  Our collective sympathy, as the Café, lies with the project of widening the circle of inclusion within the church and empowering all the baptized for the role to which they have been called as followers of Christ.

The opinions expressed at the Café are those of individual contributors, and, unless otherwise noted, should not be interpreted as official statements of a parish, diocese or other organization. The art and articles that appear here remain the property of their creators.

All Content  © 2017 Episcopal Café