Phil Driscoll has asked the U.S. Supreme court to review his housing allowance case. Earlier a three-judge panel of the federal Eleventh Circuit Court of Appeals in Atlanta overturned a U.S. Tax Court decision allowing clergy members to claim a tax exclusion for more than one home. The ruling reversed the Tax Court’s decision in Driscoll v. Commissioner, which was made final in March 2011. The taxpayers in the case were Phil Driscoll and his wife, Lynne. Mr. Driscoll, who is an ordained minister as well as a Grammy-award-winning trumpeter, heads Mighty Horn Ministries, a nonprofit based in Greensboro, Ga., that had total income of more than $6 million from 2005 to 2009.
At issue in the case were more than $400,000 of tax exclusions the Driscolls took over a period of four years for a lakefront second home near their first home in Cleveland, Tenn. The ministry provided the second home to the couple under the “housing allowance” of the tax code, often known as the “parsonage allowance.” This provision allows ordained clergy either to live tax-free in a home provided by a religious organization or to receive a tax-free annual payment to buy or rent a home as part of approved “reasonable compensation.”
Driscoll’s position is that the Tax Court erred when it concluded that the word "home" in Code Sec. 107 included both singular and plural forms of the word because the statutory context did not support the Dictionary Act’s, 1 U.S.C. §1, singular-to-plural provision. The taxpayers’ argument that, if Congress had intended to limit the income exclusion under Code Sec. 107(2) to the minister’s principal residence, it could have added language to that effect was rejected. The consistent use of the singular in the legislative history of Code Sec. 107 demonstrated that Congress intended for the parsonage allowance exclusion to apply to only one home.