Written by Don Byrd
The last time we heard from Judge Barbara Crabb, she made headlines by declaring the National Day of Prayer unconstitutional, a ruling later overturned by the 7th Circuit Court of Appeals. On Friday last week, Judge Crabb ruled unconstitutional the IRS regulation granting ministers a tax exemption for the portion of their income designated as a housing allowance. (See Associated Baptist Press coverage here.) The judge agreed with the plaintiffs that the measure violates the separation of church and state by providing clergy a tax benefit that is not extended to others.
From the decision (pdf):
In concluding that §107(2) violates the Constitution, I acknowledge the benefit that the exemption provides to many ministers (and the churches that employ them) and the loss that may be felt if the exemption is withdrawn. However, the significance of the benefit simply underscores the problem with the law, which is that it violates the well-established principle under the First Amendment that “[a]bsent the most unusual circumstances, one’s religion ought not affect one’s legal rights or duties or benefits.
However, The Baptist Joint Committee’s Brent Walker argues the housing exemption is indeed constitutional, noting that religion is not singled out; the tax code provides a variety of housing exemptions. “These include relief for members of the military, breaks for taxpayers living abroad, and exclusions for housing furnished to employees required to live on the premises or who are on 24 hour call.”
In a statement following Judge Crabb’s ruling, Walker recalls that religion-specific exemptions have been upheld by the Supreme Court in the past as expressions of government neutrality that are within the government’s discretion under the First Amendment. “Although the Free Exercise Clause of the First Amendment does not require this accommodation, the First Amendment’s Establishment Clause does not forbid it either.”
Here, importantly, the judge left the housing exemption in place pending appeals, so the “loss” she acknowledges will not be felt while we wait on the 7th Circuit to weigh in.