Justice Department Appeals Wisconsin Clergy Housing Allowance Ruling
Process with Seventh Circuit may take up to a year to resolve.

Richard Hammar, senior editor of Church Law & Tax Report and ChurchLawAndTax.com, reports the Justice Department filed a notice of appeal this afternoon in the Wisconsin clergy housing allowance case.

In late November, a federal district judge ruled the housing allowance provided to clergy was unconstitutional. The judge stayed the decision, pending the appeals process. The deadline for an appeal was this coming Monday, January 27. For the time being, housing allowances are allowed in the Wisconsin district and should be designated by churches there, Hammar said.

The Seventh Circuit Court of Appeals in Chicago will hear the appeal. The same appellate court overturned a prior ruling by the same judge a few years ago, in which the judge ruled the National Day of Prayer was unconstitutional.

Hammar provided an in-depth analysis of the housing allowance ruling, and its potential implications, in the January/February 2014 issue of Church Law & Tax Report. He said an appeal, if filed, could take up to a year to get resolved.

If the Seventh Circuit affirms the ruling, then it would affect churches and clergy in Wisconsin, Illinois, and Indiana–the three states covered by the Seventh Circuit. More significantly, though, it also would likely force the Internal Revenue Service to consider applying the ruling nationally to ensure the consistent treatment of clergy for tax purposes, regardless of their geographic location.

Should the Seventh Circuit overturn the ruling, the plaintiff–the Freedom From Religion Foundation–would have the option to appeal to the Supreme Court. Hammar considers the likelihood of the Supreme Court hearing such an appeal to be small.

Watch for updates on ManagingYourChurch.com and ChurchLawAndTax.com.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is published with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations."

Due to the nature of the U.S. legal system, laws and regulations constantly change. The editors encourage readers to carefully search the site for all content related to the topic of interest and consult qualified local counsel to verify the status of specific statutes, laws, regulations, and precedential court holdings.

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