The U.S. Court of Appeals for the Seventh Circuit issued an important decision today in Freedom From Religion Foundation v. Lew, concluding that the federal tax code provision that treats church-provided housing allowances to ministers as income tax-free must stand.
In doing so, the appeals court overturned a previous decision by a lower district court in favor of the atheist group, Freedom From Religion Foundation (FFRF). The district court had found that the exclusion is an unconstitutional benefit in favor of religious groups (click here for prior ECFA coverage of the case).
Before the Seventh Circuit could even analyze the constitutionality of the law, it first decided it had to dismiss the case on the procedural ground of standing. The court determined that FFRF and its leaders were not proper parties to challenge the law in federal court because they had not suffered any concrete, personal injury—a critical element to establish standing.
The plaintiffs here argue that they have standing because they were denied a benefit (a tax exemption for their employer-provided housing allowance) that is conditioned on religious affiliation. This argument fails, however, for a simple reason: the plaintiffs were never denied the parsonage exemption because they never asked for it. Without a request, there can be no denial. And absent any personal denial of a benefit, the plaintiffs’ claim amounts to nothing more than a generalized grievance about § 107(2)’s unconstitutionality, which does not support standing.
The Seventh Circuit’s full opinion is available for download here.
Source: Freedom From Religion Foundation, Inc. v. Lew, No. 14-1152 (7th Cir.)
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