Last year, the United States Tax Court ruled that a minister could apply a housing allowance to expenses incurred in connection with two homes that he owned. Driscoll v. Commissioner, 135 T.C. No. 27 (2010). On May 24, 2011, the case was appealed to the United States Court of Appeals for the 11th Circuit in Atlanta, Georgia. Ministers and church leaders should understand that the court of appeals may reverse the Tax Court’s decision, and as a result should not apply a housing allowance to expenses incurred in owning two or more homes without first consulting with a knowledgeable tax professional.
This article first appeared in Church Finance Today, August 2011.