Teachers Get a Housing Allowance, Right…?

Crime pays.

This guy makes DOUBLE my total household income (two wage-earners + a dependent on the way).

Where’s my housing allowance?

You may not agree with it, but that’s the separation of church and state. Deal with it.

Some pastor bought my parent’s old house in Newport Beach for $1.6 million (paid for by the church). I guess God wanted to get him some prime oceanfront real estate…

This is ridiculous. You’re right, the last paragraph is infuriating. Certainly, there must be members of clergy who don’t make much money, but there are those who do or who use the system like this. I wonder if this minister (and others like him) understand anything about “humble means”.

High cost area or not, why does a priest get such a huge tax deduction? Many churches provide living for their priests.

Note that the clergy housing allowance is currently under court challenge from the Freedom from Religion Foundation. See here.

Since ministers really just say “God did it” and “If you don’t believe X, Y, and Z you are going to hell”, they can be replaced by a simple looping tape-recorder or pull-string doll. That would make it necessary for the former pastor to find a job in the real economy, make a real contribution to society, and pay his fair share of taxes.

…and where does all that money come from? Swindling people who, I bet, don’t make that much or close to it.

This reminds me of back when I was still a Christian living in Ames, Iowa attending a church called Cornerstone. I went to a church business meeting once in 2000 and got a copy of the budget. The head pastor, who had no seminary training, made more money back then than ISU professor Hector Avalos made this past year. It just makes me mad when I hear Christians talk about how atheists live for money. Someone should tell Dr. Avalos he can make a lot more if he got back in the Christian game.

Let’s not forget we help pay for their institutions because of their tax exempt status. The pis icing on our shit cake.

Puts a different spin on Dan Dennett’s recent piece on why pastors feel financially unable to leave the church. They would have to walk straight into senior management to make anything like their current post-tax income.

Chris, I share your frustration. What does it take to make us rise up and rebel?

P. Coyle beat me to it. I was going to mention FFRF’s lawsuit. This is why I keep paying them dues. I feel a need to do something.

It’s time to end all this special privileges (for both religion and corporate America) funded by the tax payers while screwing over said tax payers by cutting program and screaming how they don’t even deserve to live if they can’t shell out hundreds of dollars a month extortion fees to insurance companies for the privilege.

P. Coyle wrote:

Note well also Erp’s point: Ministers get to exclude their housing allowances from their reported income, and then deduct their mortgage interest and property taxes from their tax liability.

The hosts of the podcast ‘Irreligiosophy’ made this precise point in relation to Rick Warren in one episode (can’t remember which one now).

So… one person (or even a few people) abusing a system is sufficient to declare it a travesty of justice? Turn off the outrage machine & you might realize that this case is an outlier, not the standard.

In my region, I recall a pastor once earning an “absurd income” (actual quote from a non-pastor) of $31,200 a year for a full time position, AFTER completing Seminary. Please note, by the standards of the church, since his position was “Full Time,” he was not allowed to have a second job, since that would mean he was not constantly available & on-call.

Given the fact he had a family, I don’t think his income was actually that “absurd.” My current ministry income is actually about $16,000 a year. Granted, I’m allowed to have a second job (which is subject to all normal tax rules) that brings my income up to a slightly more reasonable $20,000 a year. I don’t know about EVERY church in my area, but there might (emphasis on MIGHT) be one church where a pastor has a 6-figure salary, but then again, filling a leadership role for an organization of over 5,000 people might qualify a person for a large paycheck.

There are traditions where ministers are completely reliant on the church for their shelter. Some churches do this in the form of a parsonage. Others do this in the form of a housing allowance. The housing allowance exemption exists b/c of the concept of “Freedom of Religion.” This may seem foreign (or worth little complaint), but think for a moment of the dangers found in the idea of taxing “Freedom of Religion.” If that doesn’t make sense to you, then try taxing “Freedom of Speech.”

Deciding which portions of a church’s income are taxable, & which aren’t, is a very dangerous thing. “We aren’t violating Freedom of Religion. We’re just making it financially impossible for unpopular religions to survive.” And again, if you need a comparison, imagine taxing UNPOPULAR forms of Freedom of Speech.

Since there is a standing religious tradition of the pastor (or missionary, or evangelist, etc…) depending on the church for shelter, the tax code respects it as a ministry & function of the church. Are there loopholes that can be abused? Yes. But then again, welcome to American Tax Law. If you really think the ministers are the one & only group abusing the system, I applaud your willingness to be blind to a litany of other problems.

The vast majority of ministers do not have a tax sheet like that one.

And, as has been mentioned, there are a lot of strict restrictions on how Housing Allowances are handled, including things like Fair Rental Value, Cost of Care Limits, & strict regulations on when & how churches are required to hand out a Housing Allowance. I can tell you from first hand experience that your example pictured above is actually highly illegal. Mortgage, Furniture, Utilities, etc… are all considered PART of the Housing Allowance. In that particular instance, the tax preparer apparently didn’t know how to do their job.

In one case I am familiar with, a church intended to give a minister a reasonable housing allowance, but they missed the deadline. Now, the church in question could have gone back & fudged the records. It’s not like anyone would have known the difference, but the minister (I knew this individual personally, so I can say for a fact this did happen) just shrugged, accepted a full tax burden for the year, & went on with his life.

Yes, that’s right. There are a few honest ministers out there, even on financial matters.

Oh, & don’t forget… ministers are considered self-employed, so there are places where our taxes hit us harder than a normal worker. Exemptions like the Housing Allowance exist to off-set that difficulty.

A final item that will probably never make the news on this site: churches are actually hyper sensitive to the possibility of pastors abusing the church finances. Many churches take the concept of “Stewardship” very seriously, & a pastor who cheats the system gets booted very quickly & unceremoniously. I’ve seen several instances in churches around me. A church that turns a blind eye to a pastor cheating the system is the exception, not the rule. We’ve got that whole rule about “not lying,” you know.

Here’s the problem: we have a FLEXIBLE tax code. On one hand, that’s a good thing. It gives me & you a variety of exemptions, so that the government can’t put it’s hands in our pockets too many times. On the other hand, Flexible (in this instance) equals Complicated, and when you have a complicated system, people will find a way to cheat it. Businesses cheat. Individuals cheat. Heck, if you’ve ever taken any money “under the table,” you’re guilty of the same thing.

We’ll never have a tax system completely free from people who cheat it. However, the advantages of a flexible tax system far outweigh the shortcomings and loopholes. Evil pastors represent a small fraction of a much larger group of problems.

Still, I understand that some people on this site might prefer a system where there are absolutely no exemptions for religion what-so-ever. Don’t worry, there is a tax system custom made to your concerns: Consumption based (or Sales) Tax systems completely eliminate our loop hole laden system, providing a system where everyone who participates in our economy contributes at a simple flat rate, no cheating allowed.

If you’re curious about this, just check out Mike Huckabee, who is a prominent supporter of the Fair Tax. 😉

There are traditions where ministers are completely reliant on the church for their shelter. Some churches do this in the form of a parsonage. Others do this in the form of a housing allowance. The housing allowance exemption exists b/c of the concept of “Freedom of Religion.”

No, the housing allowance exists because Congress decided to give a special tax break to clergy in order to promote religion, in violation of the First Amendment.

Deciding which portions of a church’s income are taxable, & which aren’t, is a very dangerous thing. “We aren’t violating Freedom of Religion. We’re just making it financially impossible for unpopular religions to survive.” And again, if you need a comparison, imagine taxing UNPOPULAR forms of Freedom of Speech.

Do you actually suppose that the employees of an organization established for the purpose of promoting and defending atheism would be legally entitled, under the statute in question, to a clergy housing allowance as “ministers of the gospel”? Of course not. But your argument here would suggest that those employees would be the victims of the taxation, by the federal government, of an unpopular form or freedom of speech. To the extent that atheists promoting atheism are not equally entitled to the same tax breaks as ministers promoting religion, you are precisely correct.

I can tell you from first hand experience that your example pictured above is actually highly illegal. Mortgage, Furniture, Utilities, etc… are all considered PART of the Housing Allowance. In that particular instance, the tax preparer apparently didn’t know how to do their job.

Yes, it’s highly illegal because it’s a violation of the Constitution, the self-described “supreme Law of the Land.” However, it it perfectly in accord with IRS regulations. I call your attention to IRS Publication 517, which states, “You may deduct the home mortgage interest and real estate taxes you pay on your home even though all or part of the mortgage is paid with funds you get through a tax-free rental or parsonage allowance.” If your first-hand experience differs, perhaps you need to get better tax advice.

Still, I understand that some people on this site might prefer a system where there are absolutely no exemptions for religion what-so-ever. Don’t worry, there is a tax system custom made to your concerns: Consumption based (or Sales) Tax systems completely eliminate our loop hole laden system, providing a system where everyone who participates in our economy contributes at a simple flat rate, no cheating allowed.

My understanding of the Fair Tax is that, under the plan, clergy would be treated the same as employees of any other non-profit organization. This would indeed be a worthy goal. Note, however, that it would not be necessary to adopt the Fair Tax to achieve this goal. All that is necessary would be to repeal special tax breaks for clergy and religious organizations that are not available to all, including atheists and atheist organizations. But I gather that in general you are not troubled by the use of the tax code to discriminate in favor of religion and against atheism, in violation of the Constitution.

A pastor with whom I am familiar served a church that chose to give him two houses on the church property. His son-in-law couldn’t find work because he had been caught stealing from a different church. So the pastor put his daughter and her ne’er-do-well husband in the second house and persuaded the tiny, aging congregation to authorize utility payments for the second house, despite its having no role in the church whatsoever, other than housing his daughter and her husband. I realize that any individual case can be pointed to as an exception, but the contempt for government that has become a kind of second gospel for some of the faithful and their pastors is indicative of contempt for the tax law. They’ve given up any pretense of “rendering unto Caesar” and his successors a long time ago. And every dollar they don’t pay in taxes is a dollar with which the same government they decry is subsidizing them — with our money.

If you would do your own research about the allowance other than believing what others say, you would realize that it isn’t a tax break. In fact, the allowance is subject to a self-employment tax of 15.3%. My husband is a minister, I don’t have a job, and we’re barely making ends meet. In fact, WE OWE the government on our taxes. It isn’t a break. In fact, we’re looking to see if we can get out of it. Do you’re own credible research before you make assumptions.