The Freedom From Religion Foundation won a district court case (now on appeal) challenging the tax break for parsonage allowances for ministers. The judge ruled that because it applies only to ministers and not to other non-profit leaders, it violates the Equal Protection and Establishment clauses. A legislator has now proposed a bill to broaden that exemption to avoid the violation.
Today, Congressman Bill Cassidy announced he will be introducing legislation to protect faith-based institutions from unnecessary taxes. The Faith and Fairness Act of 2014 allows religious institutions to receive favorable tax status so they can provide housing for leaders of their communities. It upholds the position that the federal government has held for generations on whether such expenditures should be taxed.
Despite this long tradition of honoring faith and religion through favored status in the tax code, a recent court case deemed it unconstitutional for churches to provide ministers with tax-exempt housing allowances in lieu of housing them on church property. This legislation ensures theistic and non-theistic institutions are able to receive favorable tax status.
View the legislation here and see Dr. Cassidy’s statement below:
“The tax-exempt housing allowance helps ensure that faith-based institutions are able to extend their resources as far as possible to minister to their communities. It has been protected by federal law for generations, and its continuation is important for religious liberty. Religious institutions should be able to focus their resources on building faith and serving their people, not paying the federal government.”
That’s a reasonable solution. Given the inequality, there are two choices: Either eliminate the parsonage allowance for churches or give it to non-religious non-profits as well. Either one is fine by me.