Federal judge strikes down tax-free housing for clergy
Leaders of the Freedom From Religion Foundation, a nonprofit, requested the tax benefit. The IRS rejected their claim.
A federal judge in Wisconsin has struck down as unconstitutional a law that gives clergy tax-free housing allowances, a ruling that could have far-reaching ramifications for religious leaders who have fought for years to keep the substantial financial benefit.
Under the federal law passed in 1954, a “minister of the gospel” doesn’t pay income taxes on that part of a housing allowance designated as compensation. The Freedom From Religion Foundation, based in Madison, argued that the law discriminates against secular employees.
The benefit saves clergy, including religious leaders from traditions other than Christianity, $800 million a year in taxes, according to the latest estimate from the congressional Joint Committee on Taxation.
