The Orange County Register puts it like this:
The Rev. Robert A. Schuller — former senior pastor of the Crystal Cathedral and the son of Crystal Cathedral founder Robert H. Schuller — is one of the latest homeowners to feel the effects of the nationwide housing crash.No news in this. The Crystal Cathedral and Schuller family's squabbles and troubles have been widely reported. The only reason this is on my radar at all is found in the following paragraph:
With a foreclosure sale looming in November, Schuller is seeking bank approval to sell his Laguna Beach house “short” – that is for less than the $1.66 million he owes on two mortgages on the home.
A foreclosure auction at the Orange County Central Courthouse has been set for Nov. 2, but Schuller said he has a buyer and is just waiting for the bank to decide whether to accept the purchaser’s offer.
Schuller said he’s not having financial problems, but doesn’t have any cash flow because all his assets are tied up in two television networks, Youtoo and FamilyNet. He also lost a housing allowance tax deduction available to clergy when he left his position as Crystal Cathedral’s senior pastor in 2007.
Call me crazy, or cowardly, but if I owned a $1m plus beach house and was underwater with it, I don't think I would have the guts to whine about not receiving the housing allowance tax break on it anymore.
As a pastor with substantial church income, Schuller utilized the perfectly legal income tax deduction available to clergy but not the ordinary citizenry, the Minister's Housing Allowance. Judging from his jumbo mortgages, his debt service alone was maybe $10,000 per month and adding other housing expenses, one might guess that he was near $200,000 annually in tax free income, courtesy of the US Gummit tax policy. He lost his ministerial position and with it the lucrative Housing Allowance deduction. Things are tough, what with having to pay for the beach house and not even get a huge tax break on it anymore.
To try and make ends meet, he was advertising rooms for rent for $700 per night or $5000 per week. It is a nice little bungalow.
One wonders, why is the government giving this tax break? Shouldn't there be some cap on this? Is it serving any legitimate purpose to subsidize million dollar beach homes for the few ministers who have enough income to live in them? Is there any way to justify this tax policy at such stratospheric income and housing levels?
Schuller is not the most outrageous example of this and, sure, tens of thousands of us find the housing allowance to be a welcome, very modest, tax break. But we also are liable to get caught in the backwash from examples like this.
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For the record, I do not see a constitutional problem with the housing allowance. I do see public policy and image problems from allowing it to be used in such a fashion. Sure to comment on this is my cyber acquaintance, Robert Baty, retired IRS appeals officer who is keen on seeing the whole business ruled unconstitutional. A court case is under way on it. I suppose at some stage our SBC lobbying arm in DC will weigh in.
