Tax Exemption

Analysis: Could churches lose their tax-exempt status if they refuse to recognize same-sex marriage?

Earlier this month, presidential candidate Beto O’Rourke stated that he would support removing the tax-exempt status of organizations and institutions that oppose same-sex marriage. Specifically, O’Rourke said, “There can be no reward, no benefit, no tax break for anyone or any institution or organization in America that denies the full human rights, and the full civil rights of everyone in America.”

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FFRF decides not to appeal 7th Circuit opinion upholding parsonage allowance

The Freedom from Religion Foundation has decided not to ask the U.S. Supreme Court to review the 7th Circuit decision in Gaylor v. Mnuchin  (7th Cir., March 15, 2019) upholding a clergy-specific tax-free housing allowance provision in the IRS code. The secular organization has consistently argued that Internal Revenue Code Sec. 107(2) violates the Establishment Clause. 

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clergy housing allowance

Clergy Housing Tax Exemption Case Heard by Seventh Circuit Court of Appeals

The Seventh Circuit Court of Appeals heard oral arguments this week in Gaylor v. Peecher, a case that challenges the constitutionality of tax-exempt housing for clergy. Under 25 U.S.C. § 107(2), a pastor may receive a payment separate from taxable salary to pay for housing-related expenses including rent, mortgages and utility services.

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Why Congress dropped the Johnson Amendment repeal from tax reform

As part of the final push to enact tax reform before the end of the year, a proposed tax code change that would permit churches and other non-profit organizations to engage in partisan political campaigning has been dropped from the House and Senate reconciliation version of 2017 tax bill. Although the House version of the bill had included a repeal of the controversial Johnson Amendment, the Senate version kept it intact. Proponents of the repeal have argued for the right of pastors to speak freely about candidates from the pulpit, and opponents claim it would provide a “dark money” tax-exempt way to launder otherwise non-tax deductible campaign donations.

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