FIRST UPDATE: The US Court of Appeals for the Seventh Circuit in Chicago issued its decision on March 16, 2019, ruling the clergy housing allowance to be constitutionally permissible. Read more here.
SECOND UPDATE: The Freedom From Religion Foundation (FFRF) announced it will not petition the US Supreme Court to review the Seventh Circuit’s decision.
Oral arguments were heard nearly six months ago in the appeal to the ruling determining the clergy housing allowance tax benefit was an unconstitutional preference for religion.
But no decision on that appeal has come yet.
Is that unusual?
The short answer is no, according to several attorneys who are not directly involved with the litigation, but either specialize in church legal issues or possess familiarity with the US Court of Appeals for the Seventh Circuit in Chicago (the court hearing the case), or both.
The primary reasons are the complexity and significance of the case, given the collective value of the benefit (roughly $1 billion annually), the longevity of the benefit (about 65 years), and the First Amendment issues the case raises.
The initial decision, delivered in 2017 by a federal district judge in Wisconsin, deemed the benefit unconstitutional. If affirmed upon appeal, the housing allowance would become invalid for churches and clergy members in Illinois, Indiana, and Wisconsin. Some anticipate nationwide fallout as well.
“The question of whether the housing allowance … favors certain religious activity in violation of the US Constitution raises complex legal issues,” said Stuart Lark, an attorney with Sherman & Howard in Colorado Springs and an editorial advisor for Church Law & Tax. “In addition, the housing allowance is a valuable part of the compensation package for many church and ministry leaders of all religious and political persuasions throughout the country. If the court strikes down the housing allowance, it would create significant financial difficulty for many ministers (and their church or ministry organization employers), including retired ministers whose retirement packages partially rely upon the housing allowance.”