Monday, September 5, 2016

SBC could do better in helping pastors with sabbaticals

I never had a sabbatical, not after serving as pastor for more than a decade in two different Southern Baptist churches. By way of abject confession I'm sharing why my resume would not include any brief or extended period away from my church for renewal and rest:

I never asked.

Had I asked, the two wonderful congregations where I served longer pastorates would likely have worked with me to arrange some period away. I am none the worse for not having done that but believe now that it is a good thing for a pastor (and ministerial staff as well) to be able to take an extended time away from their church for a sabbatical.

There is, I admit, a subset of SBC pastors who have slipped into the unhealthy and unproductive attitude that they are overworked, underpaid, that the work is uniquely difficult. These are the brethren who depress gatherings of ministers with their personal and church woes.

But it is tough for the average pastor. The SBC as a whole is flat or declining meaning that most churches are not growing and that many are having difficulty properly supporting a fulltime pastor. Congregations these days have far more exposure to the megachurches with their celebrity pastors. The amount of respect given to the minister has been eroded by our scandalous, greedy, immoral, and racketeering fellow clergy. There is a consumer mentality among many prospective church members leading to an attitude from the pews that focuses more on what the church and staff can do for them and their family than how they can serve Christ through the church.

All this adds up to the pastor having to sustain a higher level of stress.

So, churches, give the guy a sabbatical who has labored for the Lord and the church five or ten years faithfully. Pay him during that period. Tell him not to worry about anything, the church will take care of the routine ministry needs while he is away. Tell him to go somewhere where he can enjoy himself (and family, of course), where he can develop fresh, new ideas. Where the daily pressures have been suspended.

Our moderate and liberal colleagues who identify with the Cooperative Baptist Fellowship have a plan and program in place for sabbaticals. If we SBCers have anything, I haven't seen it. Is the SBC doing what we do best here - talking a subject to death but not actually doing anything about it?

Our North American Mission Board has an information page on sabbaticals along with an occasional article on the subject.

Thom Ranier, LifeWay CEO, had a fairly recent article on sabbaticals. He estimates that 5% of SBC churches offer sabbaticals.

If sabbaticals are only a big church thing in the SBC, then I'm wasting time here. The vast majority of SBC churches are small congregations, single staff. Baptist Press has a nice article (rather dated but still relevant) on one of these. Noteworthy in the piece is that when the pastor returned after his five-week sabbatical he preached a month of ten minute sermons. The congregation liked them. (I know of a couple of pastors for whom I would fund a sabbatical if they would preach 10-minute sermons rather than preaching their 10 minutes worth of sermonic material and expanding it into 45 minutes).

If megachurches are the model for us these days and megapastors are the few, the mighty who are emulated by the average pastors, then here's a place where something good could come from the mega-satellite-franchised church up the road from you. Almost certainly their pastors takes one or more months away every year.

We invest hundreds of millions of dollars in training and helping Southern Baptist ministers. I would consider setting aside some funding for a sabbatical initiative that would encourage and assist churches in giving their pastor a sabbatical a good investment.

If your association, state convention, or any of our entities have a sabbatical plan for SBC ministers, feel free to comment on it and post a link.


Photo: Surf fishing at Padre Island, my idea of part of a sabbatical plan. Wiki Commons.

Saturday, September 3, 2016

They're coming after your housing allowance...again

"They" would be the Freedom From Religion Foundation which gained a victory in a federal court district ruling in 2013 which disallowed the cash housing allowance. Unfortunately for them, the ruling was overturned at the appeals level. The appeals court found a problem with a technical legal issue, standing, and made no determination about the constitutionality of the cash version of the minister's housing allowance.

This problem with standing has been resolved and we should expect, I am told, to see another suit filed by the FFRF challenging the housing allowance.

For a good summary of the matter visit the blog of my CPA friend, Peter J. Reilly whose articles on the housing allowance are informative and insightful. He wryly notes that these challenges to the housing allowance are a "great source of ecumenical spirit" with we Southern Baptists joining with Khrisna, Muslims, Greek Orthodox and other groups. Perhaps Peter is unaware that ecumenicism is still in the Southern Baptist dictionary under "things to snarl and gnash one's teeth about."

A few things to note about this continuing tap dance that concerns our Sacred Tax Break that enables us to exclude thousands from income tax and in some situations take advantage, legally of course, of a double tax break:

Only the cash version of the housing allowance is being challenged

Ministers who live in church-owned parsonages need not worry. That is not the issue here. The issue is only for those ministers who receive a portion of their compensation as a cash payment housing allowance. Parsonage-dwellers, that beleaguered subset of clergy, are like caretakers or other employees who live in their employer's housing as a convenience to their job. There is no challenge to that version of the housing allowance.

If God in heaven wanted to institute fairness in paying clergy He would surely double or triple the income exclusion for living in the church's home. Any pastor who has lived next to their church likely has a long list of complaints that flow from that. But fairness in tax policy is up to legislators and God has apparently chosen not to profane Himself by dealing directly with congressional representatives. Good choice.

The FFRF believes that it is unconstitutional to limit this tax break to ordained clergy. The courts will ponder the matter.

I expect that the venerable housing allowance will survive the challenge.

This is pure conjecture, of course; however, it doesn't help us that a very small minority of clergy who live in earthly mansions, literally, and are able therby to exclude hundreds of thousands of their income. If military personnel have a cap on the amount of their housing allowance, I don't see why this wouldn't be better public policy to do the same for clergy. But that's another issue.

You should maximize your housing allowance this and every year.

 Let the lawyers and judges sniff and snort and argue the grave constitutional issues. As long as you are eligible to take the housing allowance, get the maximum exclusion you can. (I offer this counsel only to the hardworking, modestly paid colleagues of mine who do not live in million dollar houses. The religious racketeers who live in 10,000 square foot homes should voluntarily limit themselves here, but if they have no spiritual compunction about living in a home as large as any third world dictator, then my counsel to them is likely not going to be heeded.)

You can take compensation as housing allowance for actual expenses (mortgage or rent, taxes, insurance, furnishing, repairs and improvements, utilities, etc.) so long as the total amount doesnt exceed the lower of (a) the fair rental value of the home, furnished, plus utilities, or (b) the amount your church approves as housing allowance.

Don't ignore a couple of things here:

  • Fair rental value is for a furnished house. Furnished homes may have FRV 50-70% greater than unfurnished. A state convention rep advised pastors to take 150% of FRV to allow for furnished rental value. And add utilities on top of that. I suspect that many ministers can exclude more that they presently are if these figures are considered.
  • Make doubly sure that your church pre-approves and budgets the housing allowance. GuideStone has a good Q & A page that will help you. You can't pull a figure out of the air and make it work with the IRS. Do it right.
  • Oh yeah, you have to pay Social Security taxes on the value of your home. That's the real killer tax for clergy. No relief in sight for that.
The folks involved with the Freedom For Religion Foundation are, like everyone else, our neighbors.

We should love our neighbors. I only know one member of the FFRF and my interaction with him has been respectful and cordial. Frankly, there are Southern Baptists on this and every other SBC oriented blog I read who are less respectful and cordial. 

And, please, don't let this unpleasantness stifle your enjoyment of college football today.

Monday, July 4, 2016

The strange world of autonomy and the clergy housing allowance

What a great country! Aside from a thousand other reasons, add our sacred clergy tax break the Housing Allowance which has and continues to give us a pretty good exclusion for a chunk of our cash pay. I'd speculate that the average Southern Baptist pastor is able to exclude around a couple thousand dollars a month from being reported and taxed under our income tax laws. I'm just guessing about the numbers. A pastor of an averaged-sized church with a stay-at-home wife and a few runny-nosed, exemptions , er...children, running around the house likely pays no income tax at all. 

I think the HA is secure for the foreseeable future, although there is a new legal challenge to it. I like it, use it, and think it to be a nice, modest, tax break that is appropriate and helpful.
But our world of autonomous churches makes for some interesting scenarios that arise over exactly who can qualify as a "minister" under the IRS rules on the matter. 

GuideStone answers the questions most of us have in their Commonly asked questions about minister's housing allowance. As to who is eligible for it, the Q & A says:
The Internal Revenue Service usually uses one of two tests to determine if a minister is a minister for tax purposes. The IRS normally uses the Wingo or Knight test. In deciding if a person is a “minister” for federal tax purposes, the following five factors must be considered: (1) the person must be ordained, commissioned, or licensed; (2) administration of sacraments; (3) conduct of religious worship; (4) management responsibilities in the local church or a parent denomination; (5) considered to be a religious leader by the church or parent denomination. In general, the IRS and the courts require that a minister be ordained, commissioned, or licensed, and then they apply a "balancing test" with respect to the other four factors. The more factors that a person satisfies, the more likely he will be deemed to be a minister for tax reporting purposes.
Here is where lawyers and CPAs make their money. Chase this as far as you want in legal cases and ruling but here's the simple version: You can decide for yourself (or your church for itself relative to its staff) who is a minister for tax purposes. But...the minister/taxpayer better be on pretty solid ground, as determined by the IRS, or face some bad and expensive news down the road. Because of that, GuideStone says if there is any question, you should consult with a knowledgable tax preparer or lawyer. I agree. Lest anyone isn't clear, this article isn't written by one of those.

The most of us are ordained, administer the ordinances ('sacraments' is one of those dirty words to us Baptists), conduct religious worship, have more management responsibilities in the church than we want, and are considered to be a religious leader by the church. Yes, yes, yes, yes, yes to the five IRS questions. Slam dunk. Exclude the income and don't look back (but do it right in regards to the church budget, designations, limits, and documentation or get slammed).

But what about other staff ministers? I have in mind church staff who are not the senior pastor but who exercise pastoral responsibilities. What about non-ordained but licensed staff? What about non-ordained but commissioned staff?

Good questions.

Our cherished autonomy puts every church in a position where denominational leaders, theologians, and entities are unable to dispense rulings that settle these matters. The ordination, licensing, and commissioning of individuals has not a syllable in the Baptist Faith and Message, which wouldn't interfere with churches' actions on these even if it did. A church may ordain, license, and/or commission anyone for any purpose in any manner they choose. What's this mean to the IRS? Nothing. The IRS will look at the five questions above. 

But this is the question that arises out of our peculiar circumstances: Would a woman church staff member qualify for a housing allowance?

If ordained and functioning like her male counterparts, almost certainly, yes. 
If unordained and not functioning like male staff members, almost certainly, no.
If unordained but licensed or commissioned (or even unlicensed or commissioned), maybe. Depends.

I see a lot of things today that I didn't see thirty or forty years ago. I see the ordinance of baptism being handed over to non-senior pastor church staff, no big deal there. But lately I see and hear of parents, grandparents, and even friends of the baptizee doing the actual dunking. Female staff members sometimes baptize candidates. Female staff members, sometimes administer the Lord's Supper, though not, perhaps, to the entire church assembled, rather to a smaller sub-group of members. Female staff certainly manage church matters and conduct worship, including the, uh, talking part though most commonly to sub-groups within the congregation.

What is to prevent a conservative, loyal, cooperative Southern Baptist church which has the view that from licensing or commissioning a woman staff member and that staffer being paid in an equivalent manner to her male counterparts? Nothing, of course, although my guess is that the majority of Southern Baptists would consider ordination to be the break point in this. No ordination - no housing allowance. No ordination - you really aren't considered a spiritual leader by the church. But that is up to the church, not the denomination. So, about that female staff member...

She is licensed, or perhaps commissioned in whatever formal manner the congregation chooses.

She administers the ordinances. Seems to me that one baptism, or one service (could be a women's gathering) of the Lord's Supper would demontrate this.

She conducts religious worship. Might be any or all of the congregation in most any fashion.

She has management responsibilities. 

She is considered to be a religious leader by the congregation.

She meets the IRS tests. She should be able to arrange her compensation to include the housing allowance if she so chooses. 

But, seems a number of SBC congregations, I read, are way ahead of me on the matter and have taken steps to qualify and give their female staff the housing allowance. If they are doing the same work (music, student ministry, discipleship, missions, preschool, etc.) that their male counterparts do, it is shameful if such is denied to them. The minister's housing allowance is a tax break, not a doctrinal standard.

Notably, no SBC entity - not Guidestone, not my state convention, seems to address this directly.

Perhaps they should.