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Court Rules Against Some Tax Breaks for Churches
Posted: 24 November 2013 12:24 PM   [ Ignore ]
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Court says allowing ministers to write-off their housing is unconstitutional.

A federal district court judge has declared “unconstitutional” a portion of U.S. law that allows “a minister of the gospel” to not pay income tax on a specific portion of their compensation.

U.S. District Court Judge Barbara B. Crabb of the Western District of Wisconsin ruled that the so-called “parish exemption,” which allows religious ministers to avoid paying taxes on the value of their housing granted to them by their religious employers, “violates the establishment clause” of the U.S. Constitution and must be discontinued.

The law, 26 U.S. C. § 107(2), has been on the books since 1954.

The tax exemption was estimated to cost U.S. taxpayers $2.3 billion from 2002-2007 alone, likely more in the years since.

More at the link.  I’m sure that this is going to wind up before SCOTUS because the guys with the mega-churches and multi-million dollar mansions aren’t going to give up their deductions willingly, and if the courts or Congress manage to carve out some kind of exemption that allows religious leaders who live modestly (i.e. in a house that’s valued at less than a few hundred thousand), then I wouldn’t care.

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Posted: 24 November 2013 06:25 PM   [ Ignore ]   [ # 1 ]
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I agree it should be fought for a modest pastor income.  My pastor lives comfortably and teaches that pastors are “worth their wages” as flock leader.  He says he believes pastors wages are meant to be around the average of the flocks mean income level or maybe a little more.  So that would equate to a house in the 130-200k range for the US Midwest.  It would be somewhat different for other areas of the country.

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Posted: 24 November 2013 07:23 PM   [ Ignore ]   [ # 2 ]
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Ah, some good news on that front.

I doubt that the “average” middle class worker would agree that a minister deserves to be tax-exempt whereas they are not. Why make an exception for “modest” income?

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Posted: 24 November 2013 08:05 PM   [ Ignore ]   [ # 3 ]
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TromboneAndrew - 24 November 2013 07:23 PM

Ah, some good news on that front.

I doubt that the “average” middle class worker would agree that a minister deserves to be tax-exempt whereas they are not. Why make an exception for “modest” income?

I’m willing to give those guys the benefit of the doubt and say that the majority of them spend their time selflessly helping others (you know, checking up on the lonely old people, giving money to the poor, etc.).  While I doubt have any objections to the credit being removed altogether, I think that leaving it in place for moderate income pastors would blunt the impact of the inevitable cries of “Help!  Help!  I’m being repressed!” that are no doubt being heard in response to this ruling.

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Posted: 24 November 2013 11:57 PM   [ Ignore ]   [ # 4 ]
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rodin46 - 24 November 2013 06:25 PM

I agree it should be fought for a modest pastor income.  My pastor lives comfortably and teaches that pastors are “worth their wages” as flock leader.  He says he believes pastors wages are meant to be around the average of the flocks mean income level or maybe a little more.  So that would equate to a house in the 130-200k range for the US Midwest.  It would be somewhat different for other areas of the country.

You are missing the point, though. Ministers may be “deserving” of a house in whatever price range the church members think they should have. But it should be paid for by the church members, not taxpayers. If the church members want their pastor to live in a mansion, they have a right to to make that choice—but only as long as they are willing to pay for it themselves—without taxpayer funds. In fact,  I’m in favor of there being no taxpayer subsidies for churches at all.

Lois

[ Edited: 25 November 2013 02:38 AM by Lois ]
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Posted: 25 November 2013 12:16 PM   [ Ignore ]   [ # 5 ]
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As usual, Lois is correct.  If the minister is going to take a tax break, then s/he should also be willing to give up some of the services those taxes would pay for.  Since it’s for real estate, the minister should not have police and fire protection.  By not paying the taxes all citizens pay, the minister is really declaring that s/he is not completely a citizen of the U.S. 

Hmmm.  I like that idea.  As soon as any minister commits any infraction we should be able to immediately deport him/her. LOL

[Talk about being an old fud.  Even though I do it the modern way, I still cringe when I split an infinitive.]

Occam

[ Edited: 25 November 2013 12:18 PM by Occam. ]
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Posted: 25 November 2013 12:25 PM   [ Ignore ]   [ # 6 ]
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Occam. - 25 November 2013 12:16 PM

As usual, Lois is correct.  If the minister is going to take a tax break, then s/he should also be willing to give up some of the services those taxes would pay for.  Since it’s for real estate, the minister should not have police and fire protection.  By not paying the taxes all citizens pay, the minister is really declaring that s/he is not completely a citizen of the U.S. 

Hmmm.  I like that idea.  As soon as any minister commits any infraction we should be able to immediately deport him/her. LOL

[Talk about being an old fud.  Even though I do it the modern way, I still cringe when I split an infinitive.]

Occam

Please tell me you are being sarcastic. A just society does not expect reciprocity from every citizen. If you take the pay as you go idea to it’s extreme, then we should treat developmentally delayed people pretty much like pets, giving them only minimal food and a blanket to lie on. I’d like to see churches treated like other non-profits, but no one should be exempted from police and fire protection.

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Posted: 25 November 2013 12:32 PM   [ Ignore ]   [ # 7 ]
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Apparently you misunderstood the thrust of my comment.  Of course I don’t expect anyone who is unable, to suffer because they can’t pay taxes.  What I meant what that since the ministers have just as much monetary ability as the rest of the average citizens, who are paying for the services our government offers, they should be willing to also pay for those services.  If they don’t pay their fair share then they should be willing to give up some of those services. 

Occam

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Posted: 25 November 2013 07:13 PM   [ Ignore ]   [ # 8 ]
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Lois - 24 November 2013 11:57 PM
rodin46 - 24 November 2013 06:25 PM

I agree it should be fought for a modest pastor income.  My pastor lives comfortably and teaches that pastors are “worth their wages” as flock leader.  He says he believes pastors wages are meant to be around the average of the flocks mean income level or maybe a little more.  So that would equate to a house in the 130-200k range for the US Midwest.  It would be somewhat different for other areas of the country.

You are missing the point, though. Ministers may be “deserving” of a house in whatever price range the church members think they should have. But it should be paid for by the church members, not taxpayers. If the church members want their pastor to live in a mansion, they have a right to to make that choice—but only as long as they are willing to pay for it themselves—without taxpayer funds. In fact,  I’m in favor of there being no taxpayer subsidies for churches at all.

Lois

While in a perfect world, what you propose would be the norm, we don’t live in one, and if carving out an exemption for the modest earners means that the wealthiest preachers have to start coughing up their fair share, I’m fine with that.  Remember, Scalia is on the Supreme Court, and on something like this, he’s not going to take it sitting down.  Even if he’s out-voted, he’ll work for an amendment to give an exemption to churches.  We’re not yet at a point where we can be certain that such an attempt would fail.

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Posted: 25 November 2013 07:25 PM   [ Ignore ]   [ # 9 ]
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If it passed, you can be sure that a great many people will become ordained as ministers to take that deduction. LOL

Occam

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Posted: 25 November 2013 07:30 PM   [ Ignore ]   [ # 10 ]
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Coldheart Tucker - 25 November 2013 07:13 PM
Lois - 24 November 2013 11:57 PM
rodin46 - 24 November 2013 06:25 PM

I agree it should be fought for a modest pastor income.  My pastor lives comfortably and teaches that pastors are “worth their wages” as flock leader.  He says he believes pastors wages are meant to be around the average of the flocks mean income level or maybe a little more.  So that would equate to a house in the 130-200k range for the US Midwest.  It would be somewhat different for other areas of the country.

You are missing the point, though. Ministers may be “deserving” of a house in whatever price range the church members think they should have. But it should be paid for by the church members, not taxpayers. If the church members want their pastor to live in a mansion, they have a right to to make that choice—but only as long as they are willing to pay for it themselves—without taxpayer funds. In fact,  I’m in favor of there being no taxpayer subsidies for churches at all.

Lois

While in a perfect world, what you propose would be the norm, we don’t live in one, and if carving out an exemption for the modest earners means that the wealthiest preachers have to start coughing up their fair share, I’m fine with that.  Remember, Scalia is on the Supreme Court, and on something like this, he’s not going to take it sitting down.  Even if he’s out-voted, he’ll work for an amendment to give an exemption to churches.  We’re not yet at a point where we can be certain that such an attempt would fail.

I’m not sure what you are saying here. An amendment to the Constitution?

Lois

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Posted: 25 November 2013 07:39 PM   [ Ignore ]   [ # 11 ]
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Yup.  Until we hit a population of 50% having no religious affiliation (though not necessarily atheist), an amendment to the Constitution carving out exemption for religious organizations stands a chance of passing.

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Posted: 25 November 2013 09:57 PM   [ Ignore ]   [ # 12 ]
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Coldheart Tucker - 25 November 2013 07:39 PM

Yup.  Until we hit a population of 50% having no religious affiliation (though not necessarily atheist), an amendment to the Constitution carving out exemption for religious organizations stands a chance of passing.


Only Congress can propose a Constitutional amendment and it has to be a joint resolution, requiring a majority in both houses. Then it has to be ratified by the states.  I can’t see Congress voting to propose such an amendment. There has never been a Constitutional amendment proposed regarding a tax exemption.  I can’t imagine it happening.

LL

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Posted: 26 November 2013 04:49 AM   [ Ignore ]   [ # 13 ]
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This may not be directly relevant, but IMO it does expand the conversation about religious exemptions from certain laws.

Check this out,

Court Confronts Religious Rights of Corporations

http://www.nytimes.com/2013/11/25/us/court-confronts-religious-rights-of-corporations.html?src=recg

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Posted: 26 November 2013 06:12 AM   [ Ignore ]   [ # 14 ]
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Only Congress can propose a Constitutional amendment and it has to be a joint resolution, requiring a majority in both houses. Then it has to be ratified by the states.  I can’t see Congress voting to propose such an amendment. There has never been a Constitutional amendment proposed regarding a tax exemption.  I can’t imagine it happening.

No Lois, there is yet another way. 2/3rds of the States may submit a petition to Congress on a particular issue. This is called an Article V amendment. it’s only been done once if I recall (18th Amendment) off the top of my head. Now the likelihood of that happening in today’s secessionist climate is practically nil. Especially a tax exempt issue for religious institutions in the deep South.


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Posted: 26 November 2013 07:23 AM   [ Ignore ]   [ # 15 ]
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Occam. - 25 November 2013 12:32 PM

Apparently you misunderstood the thrust of my comment.  Of course I don’t expect anyone who is unable, to suffer because they can’t pay taxes.  What I meant what that since the ministers have just as much monetary ability as the rest of the average citizens, who are paying for the services our government offers, they should be willing to also pay for those services.  If they don’t pay their fair share then they should be willing to give up some of those services. 

Occam

I didn’t say you were claiming that we should expect those who are unable to suffer, that was my argumentum absurdum. I agree ministers should be paying taxes. Even if you attempt to qualify them as exempt because they are providing some sort of service. We only do that for organizations that have passed several tests to demonstrate they are providing something, and even then we don’t exempt the employee’s income.

That’s where your idea falls apart. We provide basic services to everyone, even criminals. If we don’t, we have to come up with guidelines for who is worthy of them and who is not. I don’t want to be in that business.

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