Court upholds constitutionality of parsonage allowance
The Seventh Circuit Court of Appeals has affirmed the constitutionality of the “parsonage allowance” that allows ministers to avoid income tax on a “rental allowance”” paid as part of compensation to the extent “used to rent or provide a home.” The Court says it “falls into the play between the joints of the Free Exercise Clause and the Establishment Clause: neither commanded by the former, nor proscribed by the latter.” The allowance was challenged by the Freedom From Religion Foundation, a nonprofit that describes itself as a “nonprophet nonprofit,” and several of its officers. Their original case was dismissed for lack of standing because the officers had never applied for the allowance...
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