Monday, September 19, 2011

We knew it was coming: Housing Allowance challenged, again.

Suit challenges tax break for clergy

Somehow you knew this was coming, groups suing to eliminate the minister’s housing allowance, the tax break that lets us exclude a sizable chunk of our church income for income tax purposes. As a pastor of average sized SBC churches, I rarely paid income tax in those years when I had several dependants and have the minister’s housing allowance tax break to thank for that.

Our friends from the Freedom From Religion Foundation have refiled a suit dismissed earlier this year on our sacred clergy tax break, the minister's Housing Allowance. 'Not fair,' declare our fellow citizens who wish to be free from religion.

Can we let them declare victory, the tax code is not fair, and just go on with our lives? Nope, say FFR folks, it is unfair in an unconstitutional way.
Employees of the Freedom From Religion Foundation say they also receive a housing allowance as part of their compensation, but they do not qualify for tax exemption because they are not practicing ministers. One of the plaintiffs claims to be an ordained minister who benefitted from housing allowances paid to him by prior church employers but does not qualify now that he is no longer a preaching minister.

With rich and greedy clergy now claiming the Housing Allowance for second homes, some to the tune to excluding hundreds of thousands of dollars annually for vacation homes, meaning that Joe Sixpack is essentially subsidizing the man-of-the-cloth in his million dollar lake home, I’ve expected that assaults upon the HA would be renewed.

I can’t say that I blame the Freedom From Religion Foundation for suing over this.

Consider a couple of things about this suit:

1. Some employees of the Freedom From Religion Foundation receive a housing allowance but are not allowed to take the exemption because they are not practicing members of the clergy. Some employees of the outfit are even ordained clergy but are not allowed to take it because it is not ministerial income.

2. Military members get the HA but it is limited in amount. Ministers' HA are not limited in amount. It can be millions.

3. The tax code is senseless but the sheer absurdity of the HA as it is now applied may cause this suit to gain some traction.

We will see.

Meanwhile, hacker and plodders like me continue to use the HA to keep from paying income taxes on a good chunk of our income.


Tom Parker said...


I would hope that they would tweak this law and remove the potential for the current abuses.

Those pastors currently abusing this benefit should be ashamed of themselves.

Jon L. Estes said...


I would say, as a pastor, that a one house minimum should be part of the benefit. Yet, I would support any pastor to file his taxes legally within the tax code and if it presently allows for multiple houses, then take the benefit. A pastor doing this, IMPO, is not abusing the law but following it as every American should when they file their taxes.

A small church pastor with one home, to many bills, a beautiful wife and four grandchildren I would like more money on hand to spoil.

Gary said...

Unfortunately William, the broad brush strikes everywhere. All illegal aliens are cast as felons when some commit felonies. All welfare recipients are being targeted for drug screening because some are druggies. All Ministers are extravagant tax dodgers because some have multiple multi-Million dollar homes.

Yet some of "us" defend the extravagant to the point that it may very well affect the Ministers in the trenches.

I'd pray for Common Sense, but God would have to work miracles with heathens for it to prevail.