Saturday, November 23, 2013

The Freedom From Religion Foundation's Spite for the Small-Church Pastor

(like me.)

...and I know that "spite" is a strong word.  But when my livelihood is at stake, I take it personally, and I think in this case, if the shoe fits...

Now, to be clear, my issue isn't with atheism itself.  Someone wants to say that God doesn't exist, hey, it's a free country.  I'm not here to pick a fight with y'all, I'm really not.

So I'm curious as to why the Freedom From Religion Foundation is picking a fight with me, and with every other ordained pastor who receives a housing stipend from his/her parish.  And, from the looks of things, they have won this round.

For those of you who are unaware, thanks to a law Congress passed in 1954, parish clergy are allowed to ask their congregations to designate a certain percentage of their income as a housing stipend, and that portion of income is exempt from federal income taxes.

There are several factors that support the necessity for this particular tax break, but two big factors, mainly.  The first is that many denominations, like the Roman Catholics and United Methodists, practice an "itinerant" model of clergy assignment, meaning that their pastors have to go to where they are sent, making it more difficult for them to accumulate equity in a home.  And even in denominations like mine that do not use the itinerancy model, if I were searching for a new call (which I am not), I could not simply go out and apply for any pastorate I might want.

The second is that we clergy have our own undue tax burden: our employers (churches) are legally prohibited in the tax code from paying the usual 50% of payroll taxes that just about every other employer matches for their employees.  We have to pay that entire 15.3% ourselves, and aside from some soldiers (I do not think this is a coincidence, but that's the topic for another post), we are the ONLY profession with that burden.

So Congress decided to come up with the housing stipend exemption, figuring that hey, one kinda sorta cancels out the other.

Key phrase: "kinda sorta."

Full disclosure: My gross (pre-tax) income is $45,000 per year, which breaks down as $33,000 classified as salary (which is subject to federal income tax), and $12,000 classified as a housing stipend (which is not subject to federal income tax).  I receive taxable income from no other sources except my professional honorariums for performing weddings, which are actually paid to my church and added to my paychecks to ensure taxes are paid on them too.  My payroll tax burden on my income amounts to over $6,000 per year, whereas if I were in any other line of work, it would be more like $3,000.

Compare that to my housing stipend: after deductions and exemptions, I'm in the (for the sake of simplicity) 15% tax bracket.  And 15% of $12,000 is $1,800, which means that the amount of taxes I am saving with my housing exemption is less than my additional payroll tax burden--in fact, it only covers about 60% of it.

In other words, even with the housing exemption, I--and thousands of my colleagues--am still subject to an unfair tax burden simply because I am a pastor.

And for this reason alone, the quotes from the FFRF's Annie Laurie Gaylor really gall me--especially this quote:

"It's a really big deal.  A church currently could pay a minister $50,000 but designate $20,000 of it a housing allowance so that only $30,000 would be taxed as salary.

Yes, Annie, curse those scofflaws who have infiltrated our country through our churches in order to do caring, loving ministry for less than what a public schoolteacher gets paid!

Honestly, you want to know what that quote sounds like?  It sounds like the hateful stuff that the Tea Party spews about recipients of SNAP or WIC--look at those freeloaders, gaming the system the like that!

And, as with Tea Partiers going after the working poor, that focus is entirely misguided--there are freeloaders in the tax system, but the biggest freeloaders are the ones who have numbered accounts in Zurich and Grand Cayman, not the ones who are on food stamps.  Similarly, with the clergy housing exemption, there are way bigger freeloaders out there--which, to Gaylor's credit, she does recognize, saying in the above-quoted article, "When you're dealing with some of the megachurch pastors with huge mansions, they can be paid an enormous amount in housing allowances."

Now, on that, we can agree.  There have been numerous documented instances of wealthy ministers playing the tax code like a harp, and I wish just as much as the FFRF that they would stop gaming the system, both because it is unfair to the 99%, but also because they make well-intentioned pastors like me look bad, and hey, I do a good enough job making myself look bad on my own!

So, how do we preserve the livelihood of a middle-class fellow like myself who isn't (or demanding to) rake in the big bucks, while ensuring that the wealthy pay their fair share?  I'm not here just to argue--I'd offer two different solutions.  One is to have Congress say that only X amount of dollars--as opposed to the "fair rental value" of a home can be declared tax-exempt, that way rich pastors still have to pay tax on their mansions, but getting-by pastors like me can not be forced to dip into our meager savings to pay our tax bills.

The other is one that other bloggers have come up with before me: eliminate both the housing exemption and the undue payroll tax burden for clergy, which is really the preferable solution here.  In fact, as the blogger I linked to here suggests, the FFRF can lead the charge on that one because it is another law that arbitrarily designates out pastors.

And until the FFRF actually does, their actions (and quotes to the press) concerning clergy tax law suggest that their driving interest is not one of equality, but one of spite, to hurt pastors where it matters--our pocketbooks--simply because they can, and not because they are actually interested in seeing us treated like the rest of America's workforce.

And here's the thing: I--and, I imagine, a great many other pastors--would be thrilled to be treated like every other worker as far as taxes are concerned, if for no other reason than clergy taxes are unnecessarily complicated.  If the FFRF *did* lead the charge for this, I am sure that they could count me, and many other pastors, as allies in that objective.

But nothing that they have said or done seems to suggest that they will.  And honestly, I am not surprised.  After all, visit their homepage (linked at the top of my post), and you'll see that they are classified as a not-for-profit, educational organization, and that any donations you make to them are fully tax-deductible like with any other charity.

Because, you know, educational organizations (like, say, colleges and universities, or maybe the Smithsonian) eagerly engage in spiteful litigation to screw over their ideological opposites.

Talk about freeloaders who are gaming the tax system, indeed.

Yours in Christ,


  1. It would seem a lot of the problem is internal to the churches. If they place a special burden on their workers, should they not be the one paying them?

    Why should it be the taxpayers allowing the churches to pay less to their employees?

    And if there are indeed unfair taxing rules on church employees, why do you not work to get them changed?

    As it is now other charitable organisations cannot get the parsonage exemptions, only churches are applicable. The law was expressly made to support the spread of religion - in dire opposition to the constitution.

    I am sorry if both the government and the churches stiff the clergy, but that does not make it right to demand that the tax payers support you, you should have your union demand a living wage from your employer, and lobby the government to change any unfair tax burden.

    In fact Dan Barker was once a preacher, getting thye parsonage exemption. when he went to work for FfRF he could not get it any more - simply because FfRF is not a religious organisation, so othe people have suffered by losing the exemption too.

  2. Here's a question--if that is really how it worked--taxpayers allowing the churches to pay less to their employees and thus unduly benefiting them as religious organizations--then why isn't the FFRF making as big a deal about trying to end that practice as they are the housing exemption?

    Funny story, though, about why I don't work to get the rules changed--I'm a pastor, not a politician. I work full-time (more than full-time, really) tending to and growing the congregation that God has entrusted to me. They are the most important part of my job; I did not (nor did the vast, vast majority of us) get into ministry to get rich. I have no union to represent me or lobby the government on my behalf, it's just me. Public shaming is about the extent of my powers on this one.

    But I'll end with this: I'm not asking the taxpayers to support me; I'd be perfectly happy (and I know many of my colleagues would as well) to trade our housing exemption for being treated like every other employee as far as FICA taxes are concerned. But it also isn't as though we are the only class of taxpayer that enjoys deductions particular to us. Just ask any homeowner.

  3. Additionally--it isn't just up to my church: the tax code treats my status as self-employed for payroll tax purposes as mandatory: