IRS Penalizes Plan Of Minister To Donate House To Ministry While Continuing To Live There
Setting up a church and then donating your house to the church while continuing to live there, presumably with all the expenses run through the church and the benefit of living there being excluded under Code Section 107(1) strikes me as a brilliant scheme . You could also throw in a property tax exemption depending on what state you are in and how hungry the local assessors are. I really would have liked to see how the plan would have flown, but the Tax Court never had to get to its merits, because of poor execution. What a shame. Execution isn’t everything, but it’s a lot.
Parsonage Showdown In Seventh Circuit This Week
Although you will see this dispute being framed as one between atheists and the religious, the guy who started all this is a member of the Churches of Christ who was upset about the particularly egregious parsonage shenanigans of his own denomination. (Churches of Christ isn’t exactly a denomination by its own terms, but to those outside of it, it looks like one.)
Robert Baty was an IRS revenue officer when he was asked about the case of a college basketball coach who was excluding part of his income as a housing allowance. The practice traces back to a revenue ruling that the IRS issued under pressure from Congressmen Burleson and Bush to bail Abilene College out of a payroll audit.
Follow Me
Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.