When Religious Tax Accommodations Are Inconsistent

On Wednesday, October 24, the Seventh Circuit is going to hear arguments in the appeal of Gaylor v. Mnuchin. I’ve written about this parsonage allowance case a number of times in the past (see here and here for examples), but as a quick summary: section 107(2) of the Code says that “ministers of the gospel” don’t have to include rental allowances in gross income. Several years ago, the Freedom From Religion Foundation challenged this parsonage allowance on the grounds that it violated the Establishment Clause of the Constitution. They won in the district court, but the Seventh Circuit found that the plaintiffs didn’t have standing to challenge the provision.

The Seventh Circuit also suggested, in a footnote, that if they claimed a parsonage allowance and the IRS rejected their claim, they might have standing. So they did, the IRS did, and the district court again found the provision unconstitutional. And now the Seventh Circuit will weigh in (again).

As a side note, this provision (as well as a bunch of others) made their way into God and the IRS, the book I wrote that was recently published about tax accommodations of religious individuals. The fundamental purpose of the book was to illustrate the ad hoc nature of religious accommodations in the tax law, and develop a framework that could provide some consistency as Congress and the IRS consider providing these accommodations. [Read more…]

Pastors’ Housing Revisited (Again)

(Note: this is the fourth installment of a series (Part 1: Money for Nothing and the Housing for Free; Part 2: Pastors’ Housing, Take 2; Part 3: Pastors’ Housing Revisited) that spans four years and isn’t over yet.)

Today, a district court in the Western District of Wisconsin ruled that section 107(2) of the Internal Revenue Code is unconstitutional. Again.

So what’s section 107(2)? And what relevance could it possibly have for a Mormon blogging audience? I’m so glad you asked.

Background [Read more…]

Pastors’ Housing, Take 2

ParsonageHarpersLast week, almost a year after a district court in Wisconsin declared the parsonage exemption unconstitutional, the Seventh Circuit has reversed her decision. And thus ends a (brief) chapter in the religious culture wars.

Or not . . . [Read more…]