The Housing Allowance: May a Female Children’s Minister Claim the Housing Allowance?

Increasingly, Churches of Christ are hiring women as “ministers” — typically as children’s ministers but also in other capacities. This gives rise to the question: May they claim the housing allowance?

The Internal Revenue Code allows a “minister of the gospel” to exclude a “housing allowance” from gross income for federal income tax purposes (but not for FICA or Self-Employment Tax purposes). It’s a great benefit for ministers — who are often severely underpaid.

Details will be found at

In the Churches of Christ, we don’t have any rules for ordaining a minister. Many denominations, of course, require a very formal licensing process, but in the Churches of Christ, there are no rules or, more precisely, the rules are whatever the elders of a given congregation say the rules are.

To qualify for the housing allowance, she must both be a “minister” for tax purposes and perform ministerial functions. These are not quite the same test.

Is she a “minister” for tax purposes?

IRS Publication 517 defines a “minister” as —

Ministers defined. Ministers are individuals who are duly ordained, commissioned, or licensed by a religious body constituting a church or church denomination. They are given the authority to conduct religious worship, perform sacerdotal functions, and administer ordinances or sacraments according to the prescribed tenets and practices of that church or denomination.

If a church or denomination ordains some ministers and licenses or commissions others, anyone licensed or commissioned must be able to perform substantially all the religious functions of an ordained minister to be treated as a minister for social security purposes.

Now, for a preacher, it’s no problem to see them as “ministers” by this definition. And nearly all churches would allow a “teen minister” or “minister of spiritual formation” to fulfill these same functions. But a female minister … well, it’s not so easy.

“Sacerdotal functions” is not a Protestant sort of word. Merriam-Webster defines it as —

of or relating to priests or a priesthood

And going back to Martin Luther, nearly all Protestants would insist that all members are priests.

More challenging is having authority to “administer ordinances or sacraments.” In Church of Christ language, that means the Lord’s Supper and baptism. And very few of our congregations would allow a female to preside at the Lord’s Table or administer baptism in a Sunday morning service, even if given the title of “minister.” Just so, very few Churches of Christ would allow a female to “conduct religious worship,” such as by preaching or leading singing or a prayer. (I’m not arguing that this is right; just that this is the way it is.)

Well, that’s not entirely true. Most of our congregations would allow a woman to do any of these things in an all-female assembly, such as a ladies retreat. Some would allow a woman to baptize in a private setting.

Interestingly, I suspect most of our congregations would be more troubled by a woman baptizing someone than presiding at the Lord’s Table in an all-female assembly. And that’s not for theological reasons but because it’s such an unfamiliar thought! If you’ve grown up in the Churches of Christ, it’s just understood that only men baptize. In fact, in most Churches, only a “minister” baptizes — for no reason other than custom. There’s no doctrinal basis even among the most conservative Churches for refusing a father the privilege of baptizing his children.

But a woman baptizing? We’ve never even considered the possibility. But if a woman can accept a role of authority over other women, such as by leading a communion service, surely she could baptize someone — especially a female someone. I can’t think of any theory under which a woman would never be allowed to baptize.

Is she performing ministerial services?

IRS Publication 517 states,

Most services you perform as a minister, priest, rabbi, etc., are ministerial services. These services include:

  • Performing sacerdotal functions,
  • Conducting religious worship, and
  • Controlling, conducting, and maintaining religious organizations (including the religious boards, societies, and other integral agencies of such organizations) that are under the authority of a religious body that is a church or denomination.

You are considered to control, conduct, and maintain a religious organization if you direct, manage, or promote the organization’s activities.

Teachers or administrators. If you are a minister employed as a teacher or administrator by a church school, college, or university, you are performing ministerial services for purposes of the housing exclusion. However, if you perform services as a teacher or administrator on the faculty of a nonchurch college, you cannot exclude from your income a housing allowance or the value of a home that is provided to you.

Now, a children’s minister is plainly hired to “direct, manage, or promote the [church’s] activities” to the same degree as a teen minister, involvement minister, or the like. And she is unquestionably employed as a “teacher or administrator” of the Sunday school program.

But …

Lawrence v. Commissioner

This is from an IRS Audit Technique Guide

In contrast, the Tax Court held in Lawrence v. Commissioner, 50 T.C. 494, 499-500 (1968), that a “minister of education” in a Baptist church was not a “duly ordained, commissioned, or licensed” minister for purposes of IRC § 107. The petitioner held a Master’s Degree in Religious Education from a Baptist Theological Seminary, but was not ordained. Although his church “commissioned” him after he assumed the position, the court interpreted the commissioning to be for tax purposes, as it did not result in any change in duties. Most significant, however, was the court’s analysis of petitioner’s duties or rather, the duties he did not perform. He did not officiate at Baptisms or the Lord’s Supper, two Ordinances that closely resembled sacraments, nor did he preside over or preach at worship services. The court concluded that the evidence did not establish that the prescribed duties of a minister of education were equivalent to the duties of a Baptist minister.

Does this mean that a “minister of education” is necessarily not a “minister” for tax purposes? I don’t think so. In that particular Baptist denomination, ministers had to be ordained, and that minister was not ordained under the rules of the denomination.

More recent decisions have even made clear that formal ordination is not required if you perform the actual duties of a minister. Quoting from the same Audit Guide —

In Rev. Rul. 78-301, 1978-2 C.B. 103, the IRS followed the Tax Court decisions in Salkov and Silverman and held that a Jewish cantor who is not ordained but has a bona fide commission and is employed by a congregation on a full-time basis to perform substantially all the religious worship, sacerdotal, training, and educational functions of the Jewish denomination’s religious tenets and practices is a minister of the gospel within the meaning of IRC § 107. Revenue Ruling 78-301 revoked and modified prior revenue rulings to the extent that they required that an individual must be invested with the status and authority of an ordained minister fully qualified to exercise all of the ecclesiastical duties of a church denomination to be considered ministers under IRC §§ 107 and 1402.

In Knight v. Commissioner, 92 T.C. 199, 205 (1989), the Tax Court considered whether a licentiate of the Cumberland Presbyterian Church (a status that was less than full ordination), who had not filed a timely exemption from self-employment tax, was a duly ordained, commissioned, or licensed minister in the exercise of required duties who was thus liable for self-employment tax. The petitioner argued that he was not formally ordained as a minister and could not administer church sacraments or participate in church government. Thus, he could not be a minister subject to IRC § 1402(c). The court rejected this view, and looked at all the facts. In concluding that he was a licensed minister, it cited the facts that he was licensed by the church, he conducted worship services, and he was considered by the church to be a spiritual leader. The court also noted the petitioner preached, performed funerals, visited the sick, and ministered to the needy within the context of his duties for the church.

Thus, if Lawrence has any continuing significance, it’s that the court will look to determine whether a licensing short of a full ordination is truly the equivalent of ordination or a sham for tax purposes — and the key test will be whether the non-ordained minister in fact performs baptisms and communion services.

Arguably, a woman who is “ordained” as a minister by the elders would be fully ordained and not subject to these tests. And it would be hard to argue that woman authorized to wear the title “minister” would not have been ordained as such. In the Churches of Christ, the word does carry a certain meaning. But there’s admittedly some uncertainty here. The cases could also be read as defining “minister” based on administration of ordinances and leading worship rather than whether the minister is ordained.

But the standard isn’t whether the minister routinely performs these functions; it’s whether the minister has this authority. After all, the minister would qualify for the housing allowance if he or she were serving as a teacher or administrator of a school. Running a church school is a ministerial function, but only qualifies someone who independently qualifies as a “minister.” Hence, someone ordained to do minister sorts of things who is assigned to teach qualifies, even though they don’t often lead worship or administer ordinances.


The regulations that define “minister” rely heavily on the administration of “ordinances” and worship. Therefore, I would think a female children’s minister would qualify for the housing allowance if —

* The elders formally ordained her as a “minister” — which would only be the case if they authorized her to wear that title, rather than something like “program coordinator.”

* The ordination authorizes her to administer ordinances and lead worship, even if only before an all-female assembly. In a Church of Christ, this is unquestionable the case for any male minister without any particular formality, as it’s true of all men. But for a female minister, it should be made explicit — not by a fresh ordination but by the elders’ responding in writing to an inquiry from the female minister asking whether she has their permission to do these things. (I’d avoid a fresh grant of authority as it looks so much like a grant solely for tax purposes. She’s already been ordained. It’s just a question of what that means in her case.)

* She sometimes actually conducts worship and administers ordinances. The fact that she only does so in all-female gatherings would seem entirely sufficient. The idea of “sacerdotal” is that she is acting in a role like a “priest” in those denominations that have priests, and that ultimately means that she leads worship and administers ordinances at least some of the time. And her role is just as priest-like whether the congregation is all female or mixed.

But she needs to have actually performed these functions, I think, to be confident of the outcome.

That’s not to say that she loses if she doesn’t actually sometimes administer ordinances, because she would still be “ordained” and have that authority. The implicit idea seems to be that an ordained minister is necessarily a minister — although this is not as clear in the regulations as we’d wish. Therefore, the cautious approach is as noted above.

And by analogy to the Jewish cantor decisions, I’d point out that in the Churches of Christ, administering ordinances does not distinguish clergy from laity. Neither does leading worship. For us, it’s more a matter of those roles that have traditionally been performed by someone with that title — preaching and leading age-group ministries (among others) would be squarely within our traditional use of the term. That’s what we hire “ministers” to do, and those are the ones we consider ministers.

But for the cautious church, the bulleted points should make the leadership comfortable, and the following arguments should be helpful fall-back arguments should the need arise.

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About Jay F Guin

My name is Jay Guin, and I’m a retired elder. I wrote The Holy Spirit and Revolutionary Grace about 18 years ago. I’ve spoken at the Pepperdine, Lipscomb, ACU, Harding, and Tulsa lectureships and at ElderLink. My wife’s name is Denise, and I have four sons, Chris, Jonathan, Tyler, and Philip. I have two grandchildren. And I practice law.
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20 Responses to The Housing Allowance: May a Female Children’s Minister Claim the Housing Allowance?

  1. BKM says:

    within the meaning of IRC § 107 a Jewish cantor could be considered a minister of the gospel?

    Surely, that must be a so called ‘Messianic’ congregation, right? A, traditional cantor chants the Torah scroll and leads the prayers but would never teach from the gospels or the NT.

  2. Price says:

    Interestingly you picked up on “cautious not because it’s wrong but because it’s different” …the CoC is definitely a cautious bunch… though it must be by chance as they aren’t a collective denomination and are all independent in their thinking and application of the one true church doctrine…:)

    I can hear the “slippery slope” arguments beginning… LOL

  3. rich constant says:

    severely underpaid:
    IT would seem to me to be the operative word here
    paul uses emphatic words, I think, that would keep elders of the church of christ from exploiting ministers, teachers, and pastors.
    elders want a full time minister, (well I want a lamborghini)
    that are hard to be misunderstood, but then we all have selective hearing. that’s not to say that the elders are not going to be judge by god.
    they are and will be held accountable,stricter judgement
    elders just don’t seem to mind to put a family, a minister’s family in a situation that would not live in. financially strapped in in a no win situation. absolutely shameful
    the elders mean income plus 10 or20 percent. if they’re married and still have children and should be more if they don’t.
    the scriptural president is clear, you don’t skimp underpay exploit in anyway a preacher.

    but then were looking for loop holes in the tax structure?¿
    oops silly me.

  4. rich constant says:

    there are gas cards, phone cards gift cards all sorts of ways to circumvent the tax code.
    2 supplement.
    that would be clearly tax deductible but then
    the preacher and pastor, or teacher, full time teacher male or female.
    early understands by tradition.
    they are going to be exploited.
    especially by a cautious church of christ!!

  5. Tim Archer says:

    I had to study all of this when I began my work with Herald of Truth. I certainly consider myself a minister, but finally decided that I don’t fit the tax definition of “minister” due to the very things you discuss here.

    Outside of Herald of Truth, I do work at my local congregation that would fit that definition: preach, baptize, do weddings and funerals, etc. But that’s not part of my job with HoT.

    Grace and peace,
    Tim Archer

  6. Robert Baty says:


    Were you intending to bait me with your latest exposition on the subject?

    Despite the recent stipulated dismissal of the FFRF IRC 107 challenge, Rich Bolton was quoted in one report as saying that the suit will be refiled soon with a little different cast of plaintiffs.

    I’m still waiting for official announcements regarding that matter.

    As to females claiming the housing allowance, I have addressed that earlier. If the male basketball minister at Pepperdine qualifies for the benefit, on what basis can the female basketball minister at Pepperdine be denied the benefit.

    If a church and a woman want to agree that the the woman is a “minister”, the government is not going to be in a very good position to deny the benefit to the woman, regardless of what the woman gets paid for at the local congregation or while employed by Pepperdine.

    Maybe more later. I’m a little rushed right now.

  7. Jay Guin says:


    No, for reasons based in the equal protection clause of the 14th Amendment to the US Constitution, the IRS and courts have broadened “minister of the gospel” to include equivalent positions in non-Christian religions. Hence, IRS literature speaks in terms of “minister” rather than “minister of the gospel.”

  8. Jay Guin says:


    As to the IRS, there is nothing equivalent to Romans 14 or, for that matter, grace. When I say I’m an expert in legalism, it’s more true than I can express — having grown up in North Alabama and spending my days wrestling with the IRS.

    But this is true for a fact: The North Alabama Churches of Christ are even more legalistic than the IRS.

  9. Jay Guin says:


    Not a loophole in any sense of the word. The Internal Revenue Code expressly grants the housing allowance to ministers for exactly the reasons stated. The only question is whether our discrimination against women prevents female ministers from receiving the same tax benefit very clearly allowed to male ministers doing the exact same work.

  10. Jay Guin says:


    There are two questions:

    1. Are you a minister? Clearly, the answer is yes.
    2. Are you doing the work of a minister? The answer is not clear. Professors at ACU have been found to be doing the work of ministers, because ACU was found to be an integral agency of the Churches of Christ. If the HoT were to meet the same standards, you’d be good.

    I’d be glad to discuss offline if you’re interested.

  11. Robert Baty says:


    What, no comments for me!

  12. Jay Guin says:


    Patience ….

  13. Robert Baty says:

    I can wait!

  14. Jay Guin says:


    No, I wasn’t intending to bait you, but I knew you wouldn’t be able to resist. 🙂

    You know, the various rulings on what is the work of ministry in this context say next to nothing about what is a “minister.” Rather, they leave that question unaddressed, leading to some of the situations you allude to.

    I do not interpret “minister” as broadly as some, and I doubt that the IRS would accept the premise that “every member is a minister” as some would argue. The statute is plainly not intended to apply to every church member. Those who overreach aren’t doing any favors for those who use the exclusion legitimately. Abused tax laws tend to be amended in clumsy, overly broad ways, taking away legitimate benefits just to prevent a few abusers from taking improper advantage of the rule.

    As we tax guys say, “Pigs get fat; hogs get slaughtered.” I’d recommend against anyone claiming the exemption who isn’t clearly an ordained minister in the conventional sense of the term.

  15. Price says:

    Jay…LOL…the churches of Christ in N.E. Arkansas where I grew and was “nutured” thought you N.Alabama boys were Progressives…:)

  16. Robert Baty says:

    The Grassley Report identified some of those “hogs” and suggested it was time for the slaughter, but then Grassley refused to take action and instead referred the matter to a private, religious think-tank to think about solutions for a few years.

    Perhaps the FFRF suit, if it does get refiled, will get the issue a little more press than the original suit and, just maybe, stimulate a quicker solution to the problems of IRC 107 than is currently being considered.

  17. Brian B. says:


    I just want to clarify: the principal of a Christian school is eligible for the housing exception where the school is housed in the church building? What if the school is separately incorporated?


  18. Robert Baty says:


    In simple terms, and based on ACU’s 70-549 ruling, it is only necessary that the school be run by church members (e.g., at least 51% of management).

    ACU employees get tax free housing designations of their income.

    Pepperdine, et al, employees get the same.

    Isn’t that right, Jay?

  19. Jay Guin says:

    Brian B.,

    It’s not quite so simple. I’ll try to put together a more detailed post laying out the rules — as well as they can be divined. But here’s the gist of the rule: You must be a minister doing the work of a minister. This is near nonsense in the CoC, because we define who is a minister based on their job. We don’t have a class of people ordained as ministers doing something other than ministry — although they might be doing both ministry and something else. And this makes the rules hard to apply in our context.

    If the high school principal is a minister (as defined by the IRS), then he qualifies IF being a principal of the high school is the work of a minister — and it gets complicated from there. Robert Baty has summarized the rule, but there are subtleties to be considered.

  20. Robert Baty says:

    Here’s a link to an article out of Pepperdine that provides some insight into how some feel about “who is a minister” and a little history of how Pepperdine employees have increasingly exploited the housing allowance gimmick:

    It might be worth noting for important context that the authors of the article were not aware of how it was that Bush, Burleson and ACU were instrumental in opening the floodgates for the exploitation of the housing allowance provision.

    That was extensively discussed earlier here and reference to that discussion might be made except that Jay deleted that discussion. It is preserved elsewhere for those interested. Much more might also be said.

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