"The Layman" on the FFRF IRC 107 dismissal!
- (It's interesting that this story suggests that the FFRF is not yet making any official statement on the matter. Earlier Richard Bolton, FFRF attorney, was quoted as indicating the suit would be refiled soon.-RLBaty)
`Attacks on the clergy'
Atheist group drops challenge
of ministerial housing allowances
By Jason P. Reagan
Friday, June 24, 2011
A federal lawsuit filed by an atheist organization that could have stripped ministers of traditional housing-allowance tax exemptions was dropped after the group failed to state what kind of solution it was seeking.
On June 17, the Freedom From Religion Foundation (FFRF), a Madison, Wis.-based group, filed a voluntary dismissal in the U.S. District Court in Sacramento, Calif. in a case that sought to end housing allowances for ministers in California.
Originally filed in 2009, the lawsuit pitted FFRF and 21 of its members against U.S. Treasury Secretary Timothy Geithner, Internal Revenue Service Commissioner Douglas Shulman and California Franchise Tax Board Executive Selvi Stanlilaus and challenged, among other exemptions, federal and California statutes that allow ministers of the Gospel to exclude housing allowances from taxable income on home furnished to them as part of their compensation package.
The FFRF's dismissed complaint focused on two sections of the U.S. income- tax code as well as concurrent California law. Section 107 exempts housing allowances from taxable income while Section 265(a)(6) permits ministers to claim deductions for interest and property taxes from income derived from the housing allowance.
In its complaint, the FFRF alleged the allowance violated the Establishment Clause of the U.S. Constitution's First Amendment by supposedly providing a subsidy to ministers which would not be available to secular organizations and that the sections would allegedly result in "excessively entangling the government with religion because determinations whether the sections apply turn on religious criteria and inquiries."
However, since the FFRF failed to actually seek a specific remedy for the alleged violation, legal experts say the group had no choice but to seek dismissal because it had never asked federal or state officials for a similar allowance for its employees.
> "We are pleased that this case has been dismissed,said Kevin Snider, chief counsel for the Pacific Justice Institute (PJI), in a released statement following the dismissal.
> but we have no illusions that the FFRF and its
> allies will abandon their attacks on the clergy,"
The PJI is a national legal defense organization "specializing in the defense of religious freedom, parental rights, and other civil liberties." The group had earlier joined the lawsuit as a co-defendant.
> "We will remain vigilant to protect the outstandinghe said.
> men and women who serve our faith communities, and
> we are prepared to counter any future court challenges
> of this nature,"
An historical allowance
Housing allowances have been made available to clergy in the U.S. for more than a century. The IRS expanded the allowances in 1954 but did not define the term "minister" in the federal tax code.
In a 1987 decision, Wingo v. Comm'r, a federal tax court defined a minister for the purpose of the exemptions using the following factors: The minister must
> perform sacerdotal functions;However, in Knight v. Comm'r (1989), the tax court loosened the definition. A minister who did not administer sacraments and did not participate in church governance nevertheless was held to be a qualifying member of the clergy. According to the CPA Journal, "the opinion stated that meeting the definition of a minister is not simply an arithmetical test; having a majority of the factors in the taxpayer's favor may not be sufficient," adding that a failure to meet the criteria would have to be determined on a case-by-case basis but that ministers had to at least be licensed or ordained.
> conduct worship services;
> control or maintain the organization;
> be considered a spiritual leader; and
> be ordained, licensed or commissioned.
Enter the PJI
In October 2009, PJI filed a motion to intervene in the FFRF lawsuit on behalf of Sacramento pastor Michael Rodgers, claiming the minister would be directly affected by the outcome of the lawsuit.
> "It is unfortunate that these chronic litigantsPJI president Brad Dacus said in 2009.
> fail to see the invaluable community services
> provided by members of the clergy,"
> "Ministers of many faiths are dependent on thehe added.
> housing allowance to supplement their meager
> salaries. We will not stand by and let anti-religious
> ghouls threaten yet another American tradition,"
A federal district court initially denied the group's intervention filing and claimed the IRS and the California tax board would be able to defend Rodgers' interests without assistance.
> "When government tax collectors have every incentiveDacus said in 2010, claiming in a statement that
> to agree with the people suing them, you cannot expect
> a vigorous defense, and it is vital that the ministers
> who will be most affected by the outcome of this case
> be allowed to intervene,"
> "tax authorities have significant revenue to gainhe added.
> and nothing to lose if the atheists prevail."
> "The IRS defending a tax exemption is like the
> proverbial fox guarding the henhouse,"
The Ninth Circuit Court of Appeal reversed the decision in May.
Not the FFRF's first loss
The recent dismissal is not the FFRF's first loss in its battle against the rights of churches and religious organizations.
In April, a federal appeals court rejected the FFRP's challenge of the National Day of Prayer. The group also lost a challenge to remove a nativity scene in a Waunakee, Wis. public park.
Sacramento attorney Michael Newdow, an avowed atheist, represented the FFRF in its most recent loss over housing allowances as well as in several other lawsuits. Newdow gained notoriety in 2000 when he sued his daughter's school district, claiming the recitation of the Pledge of Allegiance violated separation of church and state. The case was later dismissed by the U.S. Supreme Court.
In 2006, a complaint by Newdow over the phrase "In God We Trust" appearing on U.S. currency was rejected by a federal court.
Newdow sued the federal government in December 2008 in an attempt to remove the words "so help me God" from the presidential oath of office.
Calls seeking comment from the FFRF on the recent dismissal were not immediately returned.