Nonprofit Resources


Renewed Attack on Minister’s Housing Allowance

On April 6, 2016, the Freedom From Religion Foundation renewed its attack on the minister’s housing allowance (Case No. 16-CV-215, Western District of Wisconsin).

The Freedom From Religion Foundation and several employees filed a complaint, alleging that the housing allowance unconstitutionally violates the Establishment Clause of the First Amendment because it provides a tax benefit exclusively to religious individuals. A copy of the complaint is available on the ECFA website.

The Freedom From Religion Foundation had a previous case dismissed because it was not able to show that anyone was injured by this alleged discrimination. This time, the group has several employees who claimed a housing allowance, which the IRS denied. Now they have “injury,” because the employees pay more tax than a minister would pay.

The filing of the complaint is only the first step in what will probably be a several-year court proceeding. The U.S. government will file a response, defending the law. Briefs and motions will be filed, and the Federal District Court of the Western District will reach a decision. It will be appealed, regardless of who wins. More briefs and motions will be filed in the appellate court. In the last case, the time from initial filing to a decision by the appellate court was several years.

About the only sure thing right now is that ministers will be able to claim a housing allowance for 2016 under the existing tax law, and in future years unless and until case law or legislation changes.

We will provide updates as developments occur.

1 Comment

  • Jeff Spear says:

    At the risk of being unpopular, I believe the MHA should be subject to means testing and should only apply to those whose primary employer is a church. Televangelists and College Presidents do not help those of us who are defending this long held practice.

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