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Excluding Parsonages from Taxation: Declaring a Victor in the Duel Between Caesar and the First Amendment

The tax exclusions for parsonages, or church-provided housing for ministers have, until recently, remained off the courts’ radar. With a case on the matter recently dismissed for lack of standing and filed with new plaintiffs in a different district court, the continuing constitutionality of parsonage exclusions is one of the most significant concerns religious institutions face today and one which will likely be appealed to the Supreme Court in the coming terms. The parsonage exclusions fall squarely under Establishment Clause jurisprudence rather than under Free Exercise jurisprudence because they do not implicate a direct government burden on the personal exercise of religion. As such, reviewing courts will examine the parsonage exclusions’ constitutionality using the Supreme Court’s three-prong test laid out in Lemon v. Kurtzman.