Jump directly to the content

Property Tax Exemption and Rental of Parsonages

Does renting a parsonage affect its tax-exempt status?

Minnesota
State:
Categories:

• Does the temporary rental of a church-owned parsonage affect the tax-exempt status of the property under a state law exempting parsonages from taxation? Yes, concluded a Minnesota appeals court. An Episcopal church owned a parsonage that was occupied by its priest. The priest resigned in 1988, and a temporary replacement priest was appointed. However, the temporary replacement priest chose to live in a neighboring metropolitan area so as to qualify for the special educational needs of his son. Accordingly, the church rented the parsonage, and used the rental income to pay a housing allowance to its temporary priest. The church intended to hire a permanent priest in the near future who would live in the parsonage. A local tax assessor claimed that the parsonage lost its tax exemption when it ceased to be used as a parsonage and was rented. The church disagreed, claiming that the parsonage ...

Join now to access this member-only content

Become a Member

Already a member? for full access.

Related Topics:
Posted:
  • July 1, 1992

Related ResourcesVisit Store

20 Finance Questions Churches Ask
20 Finance Questions Churches Ask
Richard Hammar answers relevant tax and finance questions for church leaders.
Protecting Your Tax-Exempt Status
Protecting Your Tax-Exempt Status
Understand the requirements of your tax-exempt status.