Clergy – Part 1


Church Law and Tax 1988-11-01 Recent Developments

Clergy – Taxes

The Tax Reform Act of 1986 added section 89 to the Internal Revenue Code. Section 89 imposes comprehensive nondiscrimination rules for most employer-maintained “statutory benefit plans,” including group-term life insurance and accident or health insurance plans. These rules, which prohibit discrimination in favor of “highly-compensated employees,” are scheduled to go into effect on January 1, 1989 for most employers (January 1, 1990 for church plans). However, in September the Senate voted to amend section 89 (section 710 of the Senate Finance Committee Amendment to Senate Bill 2238). Under the Senate amendment, churches and some church-related organizations would be exempt from the section 89 nondiscrimination rules. It remains to be seen whether the House of Representatives will accept the Senate amendment. A recent editorial in the Wall Street Journal called section 89 “the most challenging welfare benefit legislation ever faced by most companies,” and compared it to “dropping an atomic bomb on a suspect anthill.” As originally enacted, section 89 does not apply to church plans until January 1, 1990. Unless Congress votes to remove churches from the reach of section 89, many churches will be adversely affected beginning in 1990. You will be apprised of any legislative developments with respect to this significant issue in future issues of Church Law & Tax Report.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold 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.

ajax-loader-largecaret-downcloseHamburger Menuicon_amazonApple PodcastsBio Iconicon_cards_grid_caretChild Abuse Reporting Laws by State IconChurchSalary Iconicon_facebookGoogle Podcastsicon_instagramLegal Library IconLegal Library Iconicon_linkedinLock IconMegaphone IconOnline Learning IconPodcast IconRecent Legal Developments IconRecommended Reading IconRSS IconSubmiticon_select-arrowSpotify IconAlaska State MapAlabama State MapArkansas State MapArizona State MapCalifornia State MapColorado State MapConnecticut State MapWashington DC State MapDelaware State MapFederal MapFlorida State MapGeorgia State MapHawaii State MapIowa State MapIdaho State MapIllinois State MapIndiana State MapKansas State MapKentucky State MapLouisiana State MapMassachusetts State MapMaryland State MapMaine State MapMichigan State MapMinnesota State MapMissouri State MapMississippi State MapMontana State MapMulti State MapNorth Carolina State MapNorth Dakota State MapNebraska State MapNew Hampshire State MapNew Jersey State MapNew Mexico IconNevada State MapNew York State MapOhio State MapOklahoma State MapOregon State MapPennsylvania State MapRhode Island State MapSouth Carolina State MapSouth Dakota State MapTennessee State MapTexas State MapUtah State MapVirginia State MapVermont State MapWashington State MapWisconsin State MapWest Virginia State MapWyoming State IconShopping Cart IconTax Calendar Iconicon_twitteryoutubepauseplay