Nonprofit Resources

Court Decision Declares the Minister’s Housing Allowance Unconstitutional

On October 6, 2017, Judge Barbara Crabb of the U.S. District Court for the Western District of Wisconsin issued her anticipated decision declaring Sec. 107(2) of the Internal Revenue Code, the section authorizing the exclusion of a minister’s housing allowance from taxable income, an unconstitutional violation of the Establishment Clause of the First Amendment to the U.S. Constitution.

It is expected that the case will be appealed to the Seventh Circuit Court of Appeals in Chicago. For now, there is no change in how churches or ministers should act.

We will provide updates as developments occur. Please do not hesitate to contact us with any questions.

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