Cripplegate.com: Why do Pastors Get a Housing Allowance?

[Zguy28]

http://thecripplegate.com/why-do-pastors-get-a-housing-allowance/

Last week a federal judge ruled that the long standing practice of churches (and synagoges, mosques, dioceses, etc.) giving their pastors a housing allowance was unconstitutional. This story is likely to pick up steam in the media, and my experience with this topic is that most people (including many elders and pastors) have no idea how housing allowances work, or why they are there to begin with. So here are some FAQ’s about housing allowances and the recent ruling striking them down:

More good info at the link.

[zoony]

Give into Caesar ...

Unless you can weasel your way out of it and keep more for yourself

[AsburySkinsFan]

This will be challenged, frankly I don't like the continued expansion of this exemption. That said at least the judge tossed the part about the actual parsonages themselves. I think that in appeal her ruling will be over-turned because of lack of standing, but I could be wrong and given my history probably am.

I do struggle with the (recent?) development of pastors becoming wealthy from their churches, seems contradictory IMO and seems to reinforce the church as industry which is a disease within the Body of Christ.

Give into Caesar ...

Unless you can weasel your way out of it and keep more for yourself

It's not weaseling if the law allows for it, should I decline the EIC because it allows me to keep money and not render unto Caesar a full unadjusted tax liabilty?

[Corcaigh]

Employees should be taxed on fair value of benefits they receive.

 

For years in the UK, company cars were not taxed comparable to salary and so it became common for even junior employees to be provided with a car in lieu of higher salary, even if their job had no business driving associated with it. It was simply a way of reducing their tax burden. That loophole has been addressed.

 

In the case of provided accommodation, calculating the fair benefit may not be easy, Paying tax on the commercial rentable value of 'company-owned' property in the center of a large city may be unaffordable to many employees.

[AsburySkinsFan]

Employees should be taxed on fair value of benefits they receive.

 

In the case of provided accommodation, calculating the fair benefit may not be easy, Paying tax on the commercial rentable value of 'company-owned' property in the center of a large city may be unaffordable to many employees.

This isn't even a "company car" situation, the equivalent there would be the church owned parsonage which the judged in this case allowed. The issue in question is about cash paid housing allowance paid directly to the "pastor" which the pastor then designates as housing and whatever money is spent on actual housing is then tax deductible. If there is any left unspent from the designated amount then that money is taxed.

I'm wondering though, if the fact that pastors are considered by the IRS to be self employed is going to play a role in this down the road, from what I read I believe the group that staged their employee situation to gain standing actually had a hired employee. I don't know the particulars if that person was hired as a contractor like clergy are in the US, if not that may provide a wrinkle.

[DallasCowboyFan156]

I don't know of any pastors other than the corrupt mega churches that make $80k per year like the article mentions. Both my great grandfather and grandfather were and are pastors and they make barely enough money to stay above the poverty level. Ive heard stories that when my great grandfather was alive he was so poor at times that he had to sleep on a pallet in the church basement. He couldn't even afford a home.

[Ellis]

My episcopal church owns the house our Father resides in. He is given a modest monthly allowance.

Never had any issues.

[Springfield]

As a non-believer, I have no problem with this at all and even think it's necessary for 99.9% of the churches out there. These people do not make a large salary and serve a very important role in society. Of course this should apply to rabbis and Muslim leaders as well (and I'm sure it does).

I'm sure that the mega churches absolutely do not need this and I'd be willing to bet that they abuse the system in more ways than this. Currupt to the core.

[Kosher Ham]

Because they can.

 

Some churches makes a lot of money.

 

Then these people are able to spend it as they wish.

 

Something about the whole thing rubs me wrong.

 

And for me it's the "one bad apple" thing at times.

[chipwhich]

I don't know of any pastors other than the corrupt mega churches that make $80k per year like the article mentions. Both my great grandfather and grandfather were and are pastors and they make barely enough money to stay above the poverty level. Ive heard stories that when my great grandfather was alive he was so poor at times that he had to sleep on a pallet in the church basement. He couldn't even afford a home.

 

How many pastors salaries do you know about?

 

The pastor next to my grandparents house is a mansion.

 

I don't know what pastors make, but if you are in the congregation...you know.

[grego]

This will be challenged, frankly I don't like the continued expansion of this exemption. That said at least the judge tossed the part about the actual parsonages themselves. I think that in appeal her ruling will be over-turned because of lack of standing, but I could be wrong and given my history probably am.

I do struggle with the (recent?) development of pastors becoming wealthy from their churches, seems contradictory IMO and seems to reinforce the church as industry which is a disease within the Body of Christ.

It's not weaseling if the law allows for it, should I decline the EIC because it allows me to keep money and not render unto Caesar a full unadjusted tax liabilty?

I knew someone who went to Jericho- that monster church next to fed ex. Years ago, the congregation bought the pastor a Rolls Royce. Not sure what the pastor did with it, but I'm guessing he or she kept it.

Always rubbed me the wrong way.

[AsburySkinsFan]

I knew someone who went to Jericho- that monster church next to fed ex. Years ago, the congregation bought the pastor a Rolls Royce. Not sure what the pastor did with it, but I'm guessing he or she kept it.

Always rubbed me the wrong way.

Yeah, that kind of crap is absurd, it clearly says something about the leadership of a congragation that would think such things are appropriate regardless of whether or not the pastor kept it. If he thought it was innappropriate then kudos, but I can't imagine the headache I would have had on my way home after being "blessed" with such an absurdity.

Thankfully, those incidents are the extreme exception to the rule. That said, I've heard some very atrocious things said from Prosperity Gospel preachers as the bragged from the pulpit about their Cadillac. /facepalm

[grego]

Ya, looks like it was church property from what I found online, along with pastor peebles' Mercedes and personal chauffeur.

Grrrr prosperity teachers makes me angry.

[Zguy28]

Ya, looks like it was church property from what I found online, along with pastor peebles' Mercedes and personal chauffeur.

Grrrr prosperity teachers makes me angry.

You should read "Health, Wealth, and Prosperity" by David Jones and Russell Woodbridge. They really take that stuff to task over the non-Christian roots of it all.

Yeah, that kind of crap is absurd, it clearly says something about the leadership of a congragation that would think such things are appropriate regardless of whether or not the pastor kept it. If he thought it was innappropriate then kudos, but I can't imagine the headache I would have had on my way home after being "blessed" with such an absurdity.

Thankfully, those incidents are the extreme exception to the rule. That said, I've heard some very atrocious things said from Prosperity Gospel preachers as the bragged from the pulpit about their Cadillac. /facepalm

Amen to that. I read somewhere a few years ago that the average American pastors compensation package was roughly $18,000 annually.

[Zguy28]

As a non-believer, I have no problem with this at all and even think it's necessary for 99.9% of the churches out there. These people do not make a large salary and serve a very important role in society. Of course this should apply to rabbis and Muslim leaders as well (and I'm sure it does).

I'm sure that the mega churches absolutely do not need this and I'd be willing to bet that they abuse the system in more ways than this. Currupt to the core.

It depends. Every situation is different. Pastors are self-employed and the housing allowance can be a tricky thing. If you ask $30K for housing, you better spend $30K or you get taxed on the remainder. A good church leadership team should factor in lots of things, most importantly the median income of the congregation (as much as can be estimated) and the giving and base the package on that.

 

For every mega church pastor with a big house, there are probably 100 pastors living in poverty almost. Many men leave ministry because they just cannot provide basic needs for their families.

[chipwhich]

For every mega church pastor with a big house, there are probably 100 pastors living in poverty almost. Many men leave ministry because they just cannot provide basic needs for their families.

 

The problem is there are too many churches.  A buddy of mine is constantly opening up/supporting the opening of a new "church".  You coddle together as many people as you know and find a cheap or free place to congregate and hope to build your congregation.  Why do these churches keep spawning off, because once a church becomes "profitable" disagreements occur with how the budget is being spent.

 

Churches want to grow the congregation, and increase monetary donations.  It's a business like anything else.  If you are successful and grow you are rewarded, if you stay status quo or revenues decrease, you remain low paid.

[AsburySkinsFan]

Churches want to grow the congregation, and increase monetary donations.  It's a business like anything else.  If you are successful and grow you are rewarded, if you stay status quo or revenues decrease, you remain low paid.

Actually, I'll tell you why new churches are being "spun off", it's actually called planting, but people plant churches because it has been shown that church revitalization as a whole doesn't work and in the minority of cases where it does work the process is horribly inefficient. Our Bishop in the Kentucky Annual Conference of United Methodists has acutually gone so far as to repurpose the Conference's "New Church and Congregational Development" committee into the "New Church Development" team. What has been dropped? The congregational development, which used to focus on revitalizing stagnated churches has been dropped because the vast majority of established churches have become institutionalized and inwardly focused thus preventing them from vitality and growth. This stands in stark contrast to the majority of church plants which are outwardly focused and have been responsible for the largest percent of growth among mainline denominations.

Oh, and when a church reduces its desire for growth to "increasing revenue" then it needs to close it's doors. I am a strong critic of the church as industry which many churches have indeed become as you state, but anyone who plants a church in order to make money would be better served pan-handling.

[The Sisko]

I mentioned in another thread that I live near some of the high-profile prosperity preachers and that I have a real issue with it. However on second thought, if it degrades the "brand" of religion in public perception, maybe it helps swell the ranks of us non-believers making it a net positive in my mind.