The federal government claims it wants to give Dan Barker and Annie Laurie Gaylor, co-presidents of the Freedom From Religion Foundation, a clergy tax break for directing an atheist group.
Barker and Gaylor, as plaintiffs in FFRF’s parish exemption lawsuit, are saying to the federal government: “No thanks.”
And they’re asking a federal judge to concur.
“We’re having to tell the government the obvious — we’re not ministers of the gospel and FFRF isn’t a church!” Gaylor said.
Reporter Bob Smietana of The Tennessean in Nashville, covering the amusing but bizarre legal twist, termed the case “part chess match and part high-stakes poker game.”
FFRF contested the government’s argument in its final brief in late July in its challenge of Section 107(2) of the Internal Revenue Code giving preferential tax breaks exclusively to “ministers of the gospel.”
Under IRS provisions adopted in 1954, “ministers of the gospel” are uniquely permitted to deduct payment in the form of a “housing allowance” from their taxable income. The law’s sponsor, U.S. Rep. Peter Mack, justified the benefit on the basis that “we are being threatened by a godless and anti-religious world movement,” and said ministers of the gospel “are carrying on such a courageous fight” and “caring for our spiritual welfare.”
Gaylor quipped, “If we understand the federal government’s position correctly, it now wants to reward FFRF for fighting FOR ‘godlessness!’ ”
The legal case, which could have major ramifications for the budget of every church and paid minister in the country, awaits judgment by U.S. District Judge Barbara Crabb, Western District of Wisconsin.
Crabb ruled in August that FFRF’s separate lawsuit against the IRS for exempting tax-exempt churches from reporting requirements could proceed. (See story, front page.)
Plaintiffs are current executive directors Dan Barker and Annie Laurie Gaylor, and President Emerita Anne Nicol Gaylor, who, for several years, have had a portion of their salaries or retirement payments designated as a “housing allowance.” Under IRS provisions, the trio is not allowed to claim the income exclusion.
Crabb ruled firmly a year ago that FFRF’s nonbelieving executive directors had standing to sue over this preferential treatment. FFRF contends the law violates both the Establishment Clause and the Equal Protection Clause.
“Tax-free housing for ministers is not justifiable here as an accommodation of religion, nor is there any historical evidence that Congress enacted such tax breaks to abate government imposed burdens on the free exercise of religion,” charged Richard L. Bolton, FFRF’s lead attorney in the case. “The high cost of housing is neither a government burden, nor unique to ministers.”
The tax provision creates governmental entanglement with religion, requiring “complex determinations relating to the tenets, principles and practices of those churches that provide their clergy with housing or cash housing allowances,” the FFRF brief notes. The IRS must “engage in fact-intensive and intrusive inquiries” ensuring the individual is a “duly ordained, licensed, or commissioned” minister of the gospel, and providing religious services “in the exercise of his ministry,” and that the employer qualifies as a church.
Even Jewish cantors qualify for the housing allowance, under IRS decisions, as have coaches at parochial schools who are ordained but are paid to coach, not to minister.
In his 66-page brief on behalf of FFRF, Bolton dismissed the government’s claim that the plaintiffs qualify as “ministers of the gospel,” noting: “The plaintiffs are not ordained; FFRF is not a church; and plaintiffs do not perform religious functions.”
Although belief in a deity is not explicitly required by the IRS code (Buddhists, for instance, may be atheistic yet qualify as a religion), the IRS does require that the “minister” be seen as a spiritual leader and provide such services.
The brief points out that freethought has no sacerdotal functions, tenets or practices or forms of worship, and that FFRF’s promotion of the separation between state and church “does not constitute the practice of religion.”
A wrinkle in the suit is that Barker has an ordination — from a Christian congregation, not FFRF. He claimed the housing allowance while serving as a minister, but is now denied the housing allowance as director of an atheist/agnostic organization which disavows religion.
FFRF’s brief avers, “Section 107(2) creates an incentive for churches to designate a minister’s compensation as a housing allowance in order to increase the minister’s net income, while reducing the churches wage payments correspondingly” — a significant benefit to religion allowing them to pay clergy much less because tax-free dollars go further.
The purpose of the benefit “was intended to support and induce ministers to engage in religious activity” and to “spread the word of God” — which needless to say does not conform to constitutional dictates.
Read the entire brief and lawsuit background (scroll to FFRF v. Geithner):