Federal district court declares a religous tax exemption unconstitutional

[rdking647]

Source: US district court ruling

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.

Read more: http://thenewcivilrightsmovement.com/breaking-federal-district-court-declares-a-religious-income-tax-exemption-unconstitutional/politics/2013/11/22/79158#.Uo_sNI3SZyt

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its about time the courts stop giving special treatment to ministers... the fact is being a minister is ajob just liek any other job

[DURHAM D]

1. Now if they would just put all of the church owned properties including private universities

and commercial entities like golf courses and hotels on the property tax rolls that would be a really good day.

[happyslug]

12. Commercial entitles ARE TAXED, and always have been.

Church halls are NOT taxed, but if it turns into a steady business it becomes taxable. This has been the law for decades. Now the Church (or other religious building i.e temple, Mosque etc) are tax exempt, as are ANY property used for Charity or religious work. What is taxable and not taxable is argued all the time, The key is how much money is being made off that property. Steady income, like a golf course or hotel are always taxable. The fights are parking lots, church halls etc that are used for other purposes during the week, but used for parking or other activities on Sunday or other holy days.

Make the right argument, something like a Golf Course or Hotel will always be taxable, both as the the profits from such businesses and the land such business are on. The issue comes up on parking lots, church halls (and Volunteer fire department halls, often used for the same purposes) if the profits from renting them out when not needed for Church (or Volunteer fire department or other non-profit) gets excessive.

The big issue in my area are the non-profit hospitals, technically even hospital care is NOT a normal business and thus can be viewed as charity (Which it tended to be prior to Medicare adoption in the 1960s). That is the position of the Non-profit (but very profitable) hospital. The courts have been reluctant to rule then profit making for any profit goes back into the HOSPITAL not to shareholders. I bring this up for the same law applies to these Non profit hospital as to Churches.

[Sgent]

13. Correct on income taxes

but its not universal for property taxes. For instance, Louisiana exempts all church owned property from property taxes -- including investment property and other property owned for non-religious, non-charitable purposes.

On the other hand, Mississippi's exemption isn't nearly as broad.

[DURHAM D]

17. My comment was exclusively about property taxes and

it depends on the state/county.

[happyslug]

23. But this court ruling is about Income Taxes.

n/t

[DURHAM D]

24. I know.

Go back and read my comment - clearly I know the difference.

[Theyletmeeatcake2]

2. JESUS!!!!!!!!!

Would agree with this.....bloody pinko commie socialist he was...

[rurallib]

7. render unto Caesar and all that.

[okaawhatever]

3. District Court Judge Barbara B Crabb was appointed by Jimmy Carter, LOL. She had quite a few

right wing detractors. Apparently she also ruled against night hunting and had a notable decision with"

On April 15, 2010, Crabb ruled in a suit that the Freedom From Religion Foundation filed in 2008 against the Bush administration that the National Day of Prayer is unconstitutional.


Suck it fundies!!!

[Freddie Stubbs]

25. Apparently an appeals court didn't like her ruling on the National Day of Prayer either

http://www.csmonitor.com/USA/Justice/2011/0414/Legal-challenge-to-National-Day-of-Prayer-thrown-out

Will this case be thrown out as well?

[okaawhatever]

29. Good question. The National Day of Prayer case was overturned because the appeals court said

the group who brought the lawsuit didn't have legal standing to bring the case. I need to research to understand this case better. I'm not sure if the judge is ruling on an IRS regulation or trying to make the broader claim that the church exemption is unconstitutional.

[Swede Atlanta]

4. Yes, we need to treat these entities under the same rules

as non-profits but not subject to religious exemptions.

That includes if they contribute their money to political campaigns that money is no longer tax-exempt.

If we do that these hate groups disguised as "churches" will be disarmed.

[roguevalley]

5. I am spiritual, even religious and I find this wonderful.

[TheDebbieDee]

6. Churches are businesses that use God to solicit donations.....

Churches should pay taxes on ALL their properties and cash!

[RKP5637]

26. Yep, God, Religion, Jesus, the whole thing yields huge profits for some. It is ridiculous

some get a free pass. Also, a lot write off pleasure travel as a tax exemption, finding something along the way to do religious hence write off the whole trip. Others buy expensive tractors with religious tax write offs, for example, go cut the grass at the church, but then use it for money making ventures....but invoke the god word and many back off, oh that's religious, it's god's work. It's all bunch of BULLSHIT!

[emsimon33]

31. Amen!

[X_Digger]

8. Small step in the right direction.

I haven't parsed the decision, but there might be some nuggets in there that could be used for other cases in the same district.

[freshwest]

9. Excellent. It is a job or a profession. This ruling doesn't deny freedom to believe or think.

[alfredo]

10. Churches should pay Property taxes too.

[davidpdx]

11. It's a good first step

We need to revoke the tax exceptions for both churches and the NFL.

[emsimon33]

32. OMG! The NFL is tax exempt! OMG!!!! Yes, both and the sooner the better!

[davidpdx]

33. Yep

That would bring in tons of revenue both state (for those that have teams) and federal.

[happyslug]

14. This is a very narrow ruling, the value of the house was ruled to be taxable

That is normal, if your employer provides you a car and you can drive it off work, that part used for personal use is taxable. The same for housing, if you are moved for the convenience of your employer, then the housing is NOT taxable on the grounds you are in that house for the convenience of your employer NOT yourself. On the other hand, if it is permanent housing, how much of that housing in income to you?

The classic example of this is Military Barracks, soldiers, sailors, airmen and marines go into barracks all the time, and it is view as a benefit to their employer NOT themselves. Thus the housing is NOT income to them. On the other hand, if the Government provides housing, off base and the person that uses it can do with it as he or she feels free, it would be income.

The problem is where do you draw the line? When is something that is a benefit to your employer (such as barracks as housing) also become income (i.e. you considered part of the benefit of working for that employer NOT as compensation for working, i.e. is NO longer something you have to endure to keep your job, but the same as pay).

What the Judge ruled here was when such housing in provided to Religious leaders as part of their job as a religious leader, but for they personal use only, not as a place of extended religious purposes, it is income not an expense of working. That is all, the living quarters of a religious leader must be viewed as Income if it is provided free to that religious leader.

I have reviewed the decision, it is mostly about Standing. The GOvernment took the position that the plaintiff had no standing for they could not show any personal harm from this exemption. The Judge ruled that since it was part of the Tax Code and they pay taxes they had standing. The problem with this is the latest Standing Ruling by the US Supreme Court ruled that the people who supported Proposition 8 onto the California ballot, did not have standing in the litigation as to its constitutionality (Standing was restricted to the Governor and Attorney General of California, even through they both opposed that law i.e the people who put the proposition on the ballot, had no standing to protect it in the Federal courts).

Thus it will be interesting if on appeal, this decision is reverse, not on religious or First Amendment grounds, but that the Plaintiff had no standing to bring the suit, for they suffered no PERSONAL harm from the exemption.


http://ffrf.org/images/FFRF%20v%20Geithner%20-%20Parsonage%20Exemption.pdf

[Grins]

19. Like employer contributions to employee health care...?

"...if your employer provides you a car and you can drive it off work, that part used for personal use is taxable.

Good point.

Now, just try to win an argument to tax employer contributions to their employees health care as income for the same reason.

[happyslug]

21. That was the law till the 1970s

Then Congress stepped in and clearly said any health care program that is available to most employees (not just top management) was tax deducible.

Now, some large employers had provided such medical coverage starting in WWII, for during WWII you had wage controls. Employers could NOT offer higher wages to steal workers from other employment (With the low birth rate since 1927 and most 18-27 year old males in the Military, immigration stopped due to WWII itself, you had a severe labor shortage. The Government's solution was to ban changing work just for higher pay).

Larger employer still sought to entice workers to stay with them AND to quit they current job and go to work for the employer. One way was to provide Health Insurance, it was cheap at that time and the Federal Government said it was not income as income was called under the Wage Controls of WWII. Due to that ruling, the IRS also accepted that such health care coverage was NOT income and thus not subject to Income Taxes. This rule survived WWII, ie. the wage controls disappeared in 1945, but the rule as to such health care coverage was NOT income survived,

A problem occurred in the 1960s, more and more companies were giving such health care coverage, but only for top end employees. It is at that point that Congress stepped in. Congress stepped into this mess passed by passing a law saying such health care coverage was NOT income, if a product of a Union Contract OR was provided to 90% of the employees of the company. i.e. if you wanted to give health care coverage to top management, you had to give it to his secretary AND other low end employees, or it would be viewed as Income. That remains the law to this day.

[Judi Lynn]

15. People have wanted this to happen for ages.

Just when it looked as if the right-wing fundies had taken complete control of our country, a ray of sunlight.

Hope it won't be the last.

[idwiyo]

16. k&r. Next should be no tax exemption, period. on everything

[Major Nikon]

18. Kenneth Copeland has a lakeside mansion, a private airport, and a fleet of jets

All subsidized by the taxpayer.

http://maps.google.com/maps?f=q&source=s_q&hl=en&geocode=&q=32.979833,+-97.492167

[Festivito]

20. Ministers once were expected to house people needing a chance to get back on their feet.

We no longer have jobs for people to accomplish this type of rebounding. Instead we pay them to remain poor and isolate them where they will not find personal networks from which to find what few jobs that do exist.

So, it was a matter of time for this to happen.

To be certain it was a poorly written rule abused by flashy mega-church ministers.

[RKP5637]

27. Yep, flashy mega-church ministers that live as greedy CEOs, and the stupid flock

heaps money on them, oh, for god's work. What a bunch of suckers. If people need a god, fine, go pray, but the glitter and glamor that goes with it is unnecessary ... reminds me of adorning idols they seem to have such difficulties with ... Much of it is a sham and a ripoff. ... and many of the preachers look/act like absolute huskers. ... money changers.

[madrchsod]

22. churches are not taxed because they are a non profit

anyone who works for a church is taxed. once the government tax churches they become "citizens" and can play by the same rules as any other "citizen"

this is just a district court and it has a long way to go before it`s finished

[emsimon33]

30. FINALLY! Now if we can just get churches to pay taxes

Especially those involved in political rhetoric.