Thus, the decision handed down Friday by U. S. District Judge Barbara Crabb has riveted the attention of my Southern Baptist colleagues along with most every group who has been a beneficiary of the tax break we call the clergy housing allowance.
My interest in the housing allowance goes back several decades, since I have always used it to exclude a portion of my income from the churches I have pastored but my focus on the intricacies, history, and abuses of it are only a few years old. I heard the clear notes of a trumpet calling me to look closely at it. I credit my CPA blogging friend, Peter Reilly, for alerting me to most of the stuff happening with the housing allowance.
So, here we are with the housing allowance being ruled unconstitutional when paid in cash to a minister. Those clergy living in pastoriums weren't affected by the decision.
The reactions have been interesting.
Southern Baptists have two main entities that concern themselves with the allowance, our annuity board, GuideStone Financial Services and our lobbying arm, the Ethics and Religious Liberty Commission. The former provides clergy and churches with counsel on how to manage the allowance so as to keep the IRS happy and the latter is supposed to be a watchdog over our interests.
I get the feeling that both GuideStone and the ERLC were caught flatfooted by this decision. The two CEOs of the entities issued a joint statement and GS head, O. S. Hawkins even stated that the decision was "not unanticipated." I suppose that such anticipation was expressed around the water cooler in GuideStone's executive suite because nothing was said about it before the decision was handed down. I expect both entities to sharpen their focus now. It is incidental but both entity leaders are among the higher paid SBC clergy and likely exclude nice sums from their income tax through the housing allowance.
Naturally, the Freedom From Religion Foundation, Inc., plaintiff in the lawsuit is elated with the decision.
“May we say hallelujah!" sayeth the FFRF."Hallelujah" translates to "praise the Lord" so I am gratified that our fellow citizens at the FFRF aren't completely free from religion. Although, we hate to have our sacred tax break ox gored by the FFRF, those associated whom I have exchanged comments with have always been perspicacious, cordial and not unkind. Some Baptists commenters might take a lesson.
Judging from comments among the brethren, a good many Southern Baptist ministers believe that a Masters of Divinity degree conveys on them the ability to be an expert in constitutional law; hence, numerous pronouncements about rogue judges and what an establishment of religion really is. Let's be honest, this is a prickly issue with many components, precedents, and facets. While I disagree with the judge here, I cannot say flatly that any appeal is a slam dunk in our favor. We will see.
No reasonable, thinking Southern Baptist minister can avoid one conclusion in all this: the manner in which our housing allowance has been used borders on clergy malpractice. A growing subset of ministers who are very highly paid and who live in multi-million dollar mansions are able to exclude hundreds of thousands of dollars from income taxation. While this is perfectly legal, I would expect that most of us would think it to be bad policy for both government tax law and for maintaining clergy goodwill in the community. Do we really think it fair to shift taxes from wealthy clergy living in mansions to the less highly compensated? Surely not. Add to that the practice of churches ordaining ministry associates in administrative or peripheral church jobs solely so that they can be qualified for the housing allowance.
Not helpful, brethren. An overseer is required to be above reproach and have a good reputation in the community. Let's not forget that.
I wrote over two years ago,
Augie Boto, Frank Page, the SBC Executive Committee and our favorite SBC lobbyist, Richard Land, ought to be proactive on this matter and find a way to support legislation that will preserve the Housing Allowance in a reasonable fashion while excluding the ridiculous abuses, legal though they may be, by people like Phil Driscoll and Kenneth Copeland.While this would not affect the constitutional issue, right is right and fair is fair. It's time to get our act together on this.
We will see what happens down the road. For now nothing is changed although Thom Ranier, head of our publishing and bookstore entity, LifeWay Christian Resources, said this:
Rainer advised ministers to be conservative as they deal with the issue. "If at all possible, do not be dependent on the tax benefits garnered from having a housing allowance," he wrote. "Look carefully at the tax benefits you gain with the housing allowance. Be prepared to know what to do if the benefit goes away."No so simple for ministers who aren't as highly paid as Ranier, but this is good advice.