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IRS rules on ministerial duties.

In Letter Ruling 9231053, the IRS considered whether an ordained minister qualified for the benefits of a tax-free parsonage allowance.

The minister was assigned to an organization for which he spent approximately 75% of his time spiritually counseling alcoholics, drug addicts and their families; 20% of his time on administrative duties; and 5% of his time on traditional duties, such as conducting weddings, funerals and prayer services.

The Service ruled that this individual was not entitled to the benefits of a tax-free housing allowance. The ruling emphasized the traditional definition the IRS places on ministerial duties, namely, the conduct of religious worship or sacerdotal functions.

A number of similar rulings have held that spiritual counseling is not an activity that will qualify as ministerial. Letter Ruling 9231053 once again indicates that organizations employing clergy in nontraditional functions need to be aware of whether they are jeopardizing the individual's eligibility for the tax-free parsonage allowance.
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Author:Boyce, Marc A.
Publication:The Tax Adviser
Article Type:Brief Article
Date:Feb 1, 1993
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