"Stringent enforcement of 501(c)(3) could generate up to $16.75 billion in additional annual revenue - almost enough to fund NASA"

Hard to argue against this …

Cragun doesn’t think the U.S. will ever tax churches like corporations but, like the coalition, he thinks there should be additional reporting and auditing of churches, and that certain exemptions should be eliminated.

For example, the parsonage exemption allows clergy members to deduct their homes’ upkeep, furnishings, and utilities, in addition to rent, mortgage payments or even the cable bill.

Hard to argue? Why? It has been these kind of exemptions that has allowed small churches in small towns to be able to support their own pastors. Though there may be admittedly some who have used these things to unreasonable advantage, there are many pastors’ families whose homes often double over not only as a personal residence, but as a place where they host and entertain guests (often because of connections established through church ministry). Some have space in their houses for an office or study.

Jim, you just throw it out there like the conclusion is obvious. But if those exemptions aren’t there, it isn’t like that will produce income for the government magically out of the air with no repercussions. A church like yours would have to fund multiple salary increases for your staff to have a wage that would allow them to maintain the living standard they have become accustomed to. You might even have to eliminate positions. Missionary activity would be impacted, too. There things might be inevitable and out of our hands, but I don’t think it is a “no brainer” or not worth discussing.

First of all Pastors should be paid and they should be paid well.

You and I agree on this so my comment about the housing allowance is not an argument that Pastors should not be adequately compensated.

Would elimination of the housing allowance be negative for churches? Yes in the short term … probably a wash in the long term.

If the housing allowance were eliminated (and I think it will be …. just a matter of time), churches will need to pay their pastors more. And they should .

In response to this comment:

…. homes often double over not only as a personal residence, but as a place where they host and entertain guests (often because of connections established through church ministry). Some have space in their houses for an office or study.

Same could be said for many business persons (except strike “church ministry” and replace it with “their business”)

Recent articles:

http://www.forbes.com/sites/peterjreilly/2011/08/23/wall-street-journal…

AND

http://online.wsj.com/news/articles/SB100014240531119036356045764763400…?

Nice trick. This ‘helpful’ idea serves two purposes - punishes speech that the Secular Coalition for America would oppose -AND- attacks the viability of religious institutions in general. But the government will make money! Woo Hoo! :-/

Churches need to start planning NOW for the revocation of 501(c)(3) privileges. It’s going to happen in our lifetime.

I agree with Jim that abuses should be examined, but that’s why the IRS has agents - to investigate abuse. This proposal smells and looks like a trojan horse to me.

I agree with Greg that a significant change in tax policy would make most ministries consolidate, and it would probably financially ruin others. However, one cannot deny that, as a nation, we are subsidizing religion. As fundamentalists, we should also recognize that most of what we subsidize is “false gospel” religion. The church should be able to stand on its own, not be propped up by federal tax policy. We should depend on God’s grace, not government subsidy.

Also, think about the bad testimony we (very broad use of “we”) exude when we demand the exemption, but violate the intent of the policy (abusive televangelists with mansions and private jets), or we violate the restrictions that come along with the subsidy (pulpit freedom Sunday / old BJU dating policies). You can’t have your cake and eat it. If we truly want to be free from government oversight, if we want to avoid the stigma of the “special interest”, we should stop feeding at the federal pork bin.

Finally, I think most of us on this site would consider ourselves to be in favor of small government with a role limited by the Constitution. We would argue for equal protection under law. Why then do we defend our own little federal perk? This is just not consistent.

There is a provision for home office in the tax code

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Home-Off…

In sum how it works (and I will use self for example):

• I have a home office. It’s our den and is only used for an office.
• Both my wife and I work for a financial institution
• Same institution permits us to work from home with provisos: high speed internet … no kids at home (can’t babysit and work from home) …. a filing cabinet that locks (for work documents) … fill out HR forms … perform at a certain level …. approved by certain levels …. et cetera
• IF (big if …) the company does not provide an office AND IF home office is required for work …. IRS allows deduction (link above has details)
• IF (and this is our case) … the office is for our own convenience …. cannot deduct

[Jay]

Nice trick. This ‘helpful’ idea serves two purposes - punishes speech that the Secular Coalition for America would oppose -AND- attacks the viability of religious institutions in general. But the government will make money! Woo Hoo! :-/

A revocation of special privileges should not be considered an attack on religious speech. It is merely the removal of an unjustly privileged position. Why should my tax dollars subsidize Benny Hinn in his false-gospel, abusive, vile campaign to enrich himself? Why should my tax dollars be used to subsidize the Fred Phelps of Westboro Baptist Church as he insults the cause of Christ by traveling across America harassing the families of our fallen soldiers?

In response to this comment:

…. homes often double over not only as a personal residence, but as a place where they host and entertain guests (often because of connections established through church ministry). Some have space in their houses for an office or study.

Same could be said for many business persons (except strike “church ministry” and replace it with “their business”)

Understood… Though in many settings (especially rural), clergy members often serve a role not only in their congregations, but the larger community. I know of several pastors who double over as volunteer chaplains, de facto social workers (to use a contemporary category), and some who even occasionally open up their homes as the equivalent of a soup kitchen, homeless shelter, or similar functions. I know that in my own situation here, and in lieu of any kind of local dedicated government agency at this point, I have spent a great deal of time taking our Karen refugees to doctors appointments, getting their children enrolled in school, finding places to live, helping them get prepared for winter… I am happy to do it, as are many others who dedicate their lives to this kind of work. Those kinds of services, from a strictly civic perspective, do benefit a local community. Business owners who operate out of their homes have the ability to make deductions for business expenses, right? How is this any different, in principle?

Who said:

“I have spent a great deal of time taking our Karen refugees to doctors appointments, getting their children enrolled in school, finding places to live, helping them get prepared for winter.”

Greg you are a good man and I love you. But frankly many people volunteer like this. I commend you for your volunteerism in your community but it is not a good defense for the housing allowance.

Pastors take business deductions as well. I did when I was a Pastor. I:

• Claimed travel expenses not reimbursed by my church (for most of the time (thankfully) I was reimbursed so there weren’t many years that I took a deduction.
• I depreciated my library and took that as an expense

[Jim]

Who said:

“I have spent a great deal of time taking our Karen refugees to doctors appointments, getting their children enrolled in school, finding places to live, helping them get prepared for winter.”

Greg you are a good man and I love you. But frankly many people volunteer like this. I commend you for your volunteerism in your community but it is not a good defense for the housing allowance.

I understand many people do. There is a woman in town who does as much or more than me with our refugees, and does so on a purely volunteer basis at this point. At the same time, she is lobbying heavily to get a government funded agency established here in Marshall to address these needs. While many do volunteer, there are not as many who are able to do those things as someone like a clergy member can. Again, this isn’t just me or even Fundamentalists. I know of clergy members in our town who are active in organizing and maintaining furniture resources for needy families. Another church (that would be considered theologically liberal) has a program that supplies meals to families. These churches aren’t any better funded, typically, than ours, nor do their clergy seem to be particularly more secure financially. I understand those using these things for loopholes, and I do believe it is a problem. At the same time, as much as people might want to call these exemptions subsidies, the fact is that if religious organizations aren’t doing these kind of things, there will likely be even more government agency responsibility, which will probably be more for the expense government and less efficiency for a community in the long run.

So, because you do more charity work than me, you rate tax-free housing? What if there are non-clergy that do more charity work than you? Should they get a tax-free housing allowance?

Sean, that’s one way of looking at it, though I’m not looking to compare who does more work, and it isn’t really the point. As much as people do admirable things with their time that aren’t clergy members, there also are people who must serve as coordinators, initial contacts, and similar functions. A town that has those kind of resources is a different kind of community than one that doesn’t. Another is this; clergy are funded by contributions from others. If these benefits are removed (and I recognize this is a distinct possibility within my lifetime), it isn’t just the individual clergy who feels it. A congregation either has to increase their contributions to fund the increased expense, or may find that they are now unable to support a dedicated individual serving in that capacity. If a pastor doesn’t have to pay as much tax on his house, typically that means it takes less for him to survive on than others. The benefit may be immediately recognized by the clergy member, but it is also essentially extended to every contributing member of a church or other religious organization.