District Court Calls Minister's Housing Allowance Unconstitutional

October 9, 2017

**Updated 1/9/18**

A ruling was issued in October 2017 by a Wisconsin federal district court calling the minister’s housing allowance unconstitutional.

This decision does not come as a surprise as the same judge issued a similar ruling back in 2013 before the case was dismissed by a higher appeals court on the technical grounds of standing. Judge Barbara Crabb writes in her latest ruling, “I adhere to my earlier conclusion that [the minister’s housing exclusion] violates the establishment clause because it does not have a secular purpose or effect and because a reasonable observer would view the statute as an endorsement of religion.”

Fast forward several years, and the parties and issues are very similar except that the plaintiff bringing the case (Freedom From Religion Foundation) has tried adjusting its approach to overcome the standing hurdle.

What is the immediate impact for ministers and churches?

As of this publication, there is no immediate impact on ministers receiving a housing allowance from their church or other employer. The longer-term impact hinges on whether appeals are filed in the case.

If No Appeals Filed

It’s possible there will be no appeals filed in the case by the government or other parties impacted (“intervenor defendants”), meaning the district court’s decision will begin to apply immediately after the deadline expires for them to file an appeal. 

If Appeals Filed

However, there is a good chance the government or other parties impacted will appeal the decision at least to the Seventh Circuit Court of Appeals and possibly even the U.S. Supreme Court. 

An appeals court could disagree with the lower court and find the housing allowance constitutional. In the alternative, if the lower court ruling is upheld on appeal, the district court’s ruling states it will not go into effect until 180 days after the appeals process concludes.

What about ministers living in parsonages?

The district court further clarified in its follow up ruling that this decision does not apply to Section 107(1) of the tax code. In other words, the ruling has no impact whatsoever on ministers living in church-provided housing (“parsonages”). 

Watch for the latest developments as they unfold at ECFA's "In the News" page. 



This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.


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