Originally published on Forbes.com Aug 18th, 2013
The litigation between the Freedom From Religion Foundation and the United States over the parsonage exclusion has taken an odd turn.  The Government is trying to convince a couple of atheists who get housing allowances from  FFRF that maybe they might qualify as “ministers of the gospel”.
Background
The parsonage exclusion (Code Section 107) allows “ministers of the gospel” to exclude from income both in-kind housing they receive from congregations and cash housing allowances that are spent on housing.  Although the benefit is usually a fairly modest boost to the take-home pay of ministers of small congregations, there is no dollar limitation allowing for the folks my blogging buddy Reverend William Thornton calls “religious racketeers” to have six-figure housing allowances.  As Reverend Thornton wrote:

Someone make the case that Joe Sixpack has to pay taxes on his income and doesn’t get any exclusion for his singlewide complete with a deck and a mangy dog sleeping under it, while Kenneth and Gloria Copeland live in an 18,280 square-foot lakefront parsonage on 25 acres valued at $6.2 million and exclude hundreds of thousands of dollars from income taxes under the housing allowance, or while Phil Driscoll enjoys not owing federal income taxes on $408,638 provided to him by his ministry to buy a second home on a lake near Cleveland, Tenn.

FFRF, on the other hand, is upset by any housing allowance for clergy viewing it as an unconstitutional subsidy to religion.  That is why they are suing.
The Problem of Standing
It is actually pretty hard to litigate about somebody else’s tax break.  The explanation is pretty lawyerly.  The general idea is that if you think the laws are screwed up in general, you should be calling your congressman.  To have access to the courts you should be arguing that the laws are screwing you specifically.  FFRF came up with a clever way around this problem.  They started paying two of their officers housing allowances.  They could then argue that they were being treated unfairly, because  they were not entitled to exclude their housing allowances.  The Government, in a summary judgment  motion, argued that they did not have standing, because they did not file a claim with the IRS, but the Court thought that was pretty silly, since the FFRF officers were clearly not ministers.  That was nearly a year ago.
Things Get Weird
So now we come to the weird turn.  In another summary judgment motion, the Government is arguing that maybe the FFRF officers are ministers.  It reminds me a little of a travelling salesman joke – probably the only traveling salesman joke that would not run afoul of the contributor guidelines.  The travelling salesman has a flat tire and finds that his jack handle is missing.  It is very late.  He decides to walk half a mile to a farmhouse and ask to borrow a jack handle.
As he is walking he reflects on how annoyed the farmer might be to be awakened.  You can stretch the joke out for as long as you want here with various thoughts the salesmen might have.  At any rate, he knocks on the door and a groggy farmer asks him what he wants.  The travelling salesman says “To heck with you.  You can keep your GD jack handle.”  The Government is taking the role of the puzzled farmer.  Gee, why are these guys suing ?  Maybe if they asked nicely we would let their housing allowances be exempt.
The Motion
The government motion goes into the history of the exclusion in order to show that it is a reasonable accommodation rather than a subsidy to religion.  Housing that is provided to an employee for “the convenience of the employer” was generally considered to be exempt. Examples are things like mining camps and bunks for sailors.  The Treasury announced in 1921 that it was not going to follow that rule with respect to parsonages.  Congress intervened.  So the earliest version of the exclusion was to put ministers in the same position as secular workers.  That accounts for the in-kind exclusion.  The cash exclusion came later.

But, at the time, less-established and less wealthy religions were not able to provide housing for their spiritual leaders; among them were denominations that employed part-time ministers and rabbis “characteristic of smaller, newer, and less affluent religious groups such as Pentecostals, evangelical churches, and independent African-American congregations.

So the cash housing allowance exclusion was to even things out among different religions.
Can Atheists Qualify ?
The Evangelical Center for Financial Accountability, which follows the parsonage issue closely, seems quite surprised by the Government’s position.

The ongoing litigation over the constitutionality of the clergy housing exclusion has taken a fascinating turn. According to attorneys for the U.S. Department of Justice, not only is the law constitutional, but atheists might also be considered religious leaders for purposes of federal tax law (“ministers of the gospel”) to qualify for the exclusion.

Essentially the Government’s argument is that qualification as a “minister of the gospel” is based on what you do, not what you believe.

But the facts here illustrate that it is conceivable that an atheist who does things that Ms. Gaylor and Mr. Barker do in light of their personally held beliefs and in the course of their employment could meet the requirements for the exclusion in § 107(2), including the definition for “minister” under its terms.  Non-theistic beliefs, including atheism, may qualify as “religious” beliefs in various contexts because they pertain to religion and fulfill a similar role in a person’s life: hen a person sincerely holds beliefs dealing with issues of “ultimate concern” that for her occupy a “place parallel to that filled by . . . God in traditionally religious persons,” those beliefs represent her religion. We have already indicated that atheism may be considered, in this specialized sense, a religion.

Do Atheists Already Get Ministerial Housing Allowances ?
What I find interesting about this litigation is that a particular tax benefit has taxpayers, who conceivably might qualify for the benefit, strenuously arguing that they don’t qualify and the Government arguing that they might.  The notion of atheists qualifying is actually not that strange.  The Unitarian Universalist Association of Congregation, which is a non-creedal denomination, recognizes atheism.  There are probably some theistic Unitarians who think the UUA countenances atheism to a fault.

Atheists and Agnostics are welcome in Unitarian Universalism and can find a welcoming, supportive faith community in our congregations. Although both groups are often defined by what they do not believe, the reality is that they do believe in a great many things, including many beliefs affirmed within Unitarian Universalism. They believe, for example, that we as humans are responsible for our own actions, that the here and now is important, and that it is good to try to make this world a better place.
While Unitarian Universalists may share many beliefs in common with many Atheists and Agnostics, we do not have to. As a non-creedal faith, Unitarian Universalism honors the differing spiritual paths we each travel. Our congregations are places where we celebrate, support, and challenge one another as we continue on these journeys. For this reason, many interfaith families—and this increasingly includes those with members who are Atheist or Agnostic—find Unitarian Universalism can uniquely meet their spiritual needs.

Should Liberal Religious Ministers Accept Tax-free Housing Allowances ?
Some of the oldest congregations in the country are affiliated with the UUA.  When you see the iconic white steeple facing the common in a Massachusetts town, there is a decent chance that the church is UUA and was originally the established church that was founded at the same time as the town.  Despite the established church roots, Unitarians tend to be in favor of church state separation.

Reverend John Gibbons of First Parish in Bedford, Massachusetts, one of my facebook buds, wrote to me that he generally opposes special tax status for clergy and churches.  He told me he was very pleased that he had a role in convincing First Parish to make a payment in lieu of taxes to the Town of Bedford.

“Some of our members—myself included,” he continued, “question whether any religious institution should be exempt from public taxation. All of our members—affirmed indeed by a unanimous vote of our congregation at our Annual Meeting last June—agree to express our gratitude to the Town in this way.

It was only a hundred bucks, but I guess it is the thought that counts.  I’m thinking of asking Reverend Gibbons to spearhead a group of religious liberal clergy – e.g. UU ministers, Reform rabbis, Episcopal priests – to renounce tax-free housing allowances.  In a burst of ecumenism, they might invite Southern Baptists, who have very strong historic church state separation roots, to join in.
I’m not holding my breath.
You can follow me on twitter @peterreillycpa.