Leftist Federal Judge Takes Away Ministers’ Housing Tax Break

(Kaylee McGhee, Liberty Headlines) A federal court in Wisconsin struck down a longstanding tax provision on Friday that protected ministers and other religious officials to live close to their churches or the communities they serve.

Leftist Federal Judge Takes Away Ministers' Housing Allowance

Judge Barbara Crabb/PHOTO: Wisconsin Bar

The “parsonage allowance,” protected by nearly 65 years of precedent, was deemed a violation of the Establishment clause, “because it does not have a secular purpose or effect and because a reasonable observer would view the statute as an endorsement of religion.”

Ken Klukowski, an attorney for the First Liberty Institute, said on “Washington Watch with Tony Perkins” that he wasn’t surprised by the ruling, given federal Judge Barbara Crabb’s past far-left rulings.

“I understand how she reached her decision,” Klukowski said. “I think it’s wrong, not because she didn’t engage in a careful analysis, but because she fundamentally flips on its head what the Establishment clause is supposed to all be about.”

The “parsonage allowance,” a federal law established in 1954, stated that a “minister of the Gospel” does not need to pay income taxes on compensation that is designated to his or her housing bills. The Freedom From Religion Foundation, an atheist organization based in Madison, argued the statute discriminated against secular employees.

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Becket law, a religious freedom nonprofit representing a Chicago-based pastor Chris Butler, said the law cannot be discriminatory, since it also covers secular employees who receive housing funds from employers.

Becket said that if Butler lost the housing allowance, he would be forced to move out of his neighborhood — one of the poorest in the city — and find a second job to support his family. The court’s decision could even force churches to close altogether, the group said.

Crabb agreed with FFRF, however, saying the tax code allows clergy members and other religious officials to “double dip,” a practice in which citizens use untaxed income to purchase a home and then deduct the interest paid on the mortgage and property taxes.

“In reaching this conclusion, I do not mean to imply that any particular minister is undeserving of the exemption or does not have a financial need for one,” Crabb wrote in her decision. “The important point is that many equally deserving secular employees (as well as other kinds of religious employees) could benefit from the exemption as well, but they must satisfy much more demanding requirements despite the lack of justification for the difference in treatment.”

Crabb struck down the law in 2013, but the 7th U.S. Circuit Court of Appeals reversed the ruling after it was appealed, saying the FFRF did not have legal standing to bring the lawsuit, since its co-presidents had never been denied the parsonage exemption. The co-presidents then requested the tax benefit in 2015 and were rejected by the IRS, allowing them to file a new lawsuit in 2016.

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Hannah Smith, senior counsel at Becket, said that nothing about the tax code was unconstitutional, since it treated both religious and secular employees the same.

“It’s not unconstitutional for the federal government to treat faith leaders the same as other secular employees in their housing allowances. In fact, treating them differently would be discrimination against religion, pure and simple,” she said in a press release.

Klukowski said there is a chance that the case can be appealed because of Crabb’s obvious anti-religious bias. Annie Laurie Gaylor, a co-president of FFRF, said she was confident the decision would survive appellate challenges, however.

“It’s a huge ruling,” she said. “The last one created shockwaves and this one should really be creating them. I think everybody knows we’re right, they just don’t like changing the law.”

Butler said the ruling does a disservice to the religious community and to the Constitution. He said he hopes a higher court will uphold the true interpretation of the Establishment Clause.

“This decision is crippling to the equal treatment of our nation’s faith leaders—but it will not stand,” he said in a statement. “Our job and our life’s purpose are one and the same: to serve our congregations and our communities 24/7. Living close to our faith communities is vital to our missions, and we should not face discriminatory tax penalties for doing so.”

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  • Naval Lint

    I believe that it’s time for Americans to strip these politicians of THEIR exemptions to the laws of the land! And it’s also time for all of these politicians to start paying THEIR own way, as well. NO MORE PACS! NO MORE EXEMPTIONS! NO MORE ‘INSIDER TRADING’!!!! NO MORE SECRET SERVICE PROTECTIONS!!!! Let these congress-crtters live the SAME WAY that WE DO!!!!

  • Al Zabel

    Typical leftist wienie.
    The Constitution, grants the Freedom Religion.
    Not the freedom from religion.
    And why is it, that when the Constitution, stands against their liberal policies?
    It is just a piece of out dated paper?

  • Steve G.

    I must say, as a Republican, I agree with the judge. Religion should not be an excuse not to pay taxes. This minister is a man not a deity and should pay taxes like everyone else. The tax code is so unfair it’s sickening. Lots of tax breaks for all kinds of people, groups, and behaviors. Too many people get representation with out taxation. Time for a flat tax and the end of the argument of what your fair share is.

  • Irredeemably Deplorable

    I think laws should apply equally to both “religious” and non religious people, which ever way the law goes. Taxes should be paid by all and exemptions should be equal. Special treatment should be given to poor in many cases, but not those who preach the gospel of Jesus Christ.

    My question to those who seek exemptions because they are ministers or preachers is:
    Where is your new testament biblical justification for expecting special treatment by the law for being a servant of Christ?

    It is my view that Christians should not take advantage of the law or ever presume to be protected by the law. Christians are supposed to be protected by God and consider others to be esteemed higher than themselves. Therefore they should never appear to be in a better position than another person, with respect to the law. Finding themselves blameless.

    I believe the practice should also be that preachers and ministers should support themselves outside the church and be counted as a servant not an employee of the church. Again, I would ask of those in that position to provide justification from their bible for believing they are exempt from doing what Christ and the Apostles directed all Christians to do.

  • fantomnutt

    I still say ALL federal judges should be elected by the distric or the country they serve.