The Clergy Housing Allowance On Trial – New Developments

Will the clergy housing allowance stand?  Members of the clergy continue to receive mixed signals.  Two federal district courts in Kentucky and Wisconsin have considered the question – with very different outcomes.  The Wisconsin case is now on appeal before the Seventh Circuit Court of Appeals.  The venerable housing allowance stands in the balance.  Hundreds of thousands of clergypersons could be impacted by outcome of the appeal. We therefore provide this update and some insight on how the divergent outcomes might impact the Seventh Circuit’s decision. 

IRS Not Above First Amendment

The First Amendment trumps IRS’ interpretations of the limits of its authority.  In heartening news for nonprofits, a federal district court recently rejected the IRS’s efforts to defeat a First Amendment claim filed by an advocacy organization seeking Section 501(c)(3) recognition.   The case was filed by Z Street, Inc., a nonprofit corporation dedicated to educating the public about issues related to Israel and the Middle East.   See Z St., Inc. v. Koskinen, 12-CV-0401 (KBJ), 2014 WL 2195492 (D.D.C.