“Tithing And College Expenses Only Conditionally Allowed In Determining IRS Installment Agreement” by Frank C. Carnahan

The IRS determination that (a)n individual’s church tithing expenses were only allowed as “conditional expenses” to determine how much he could pay in a partial installment agreement because the classification: (1) conformed to the Internal Revenue Manual guidelines; (2) did not violate the Free Exercise Clause of the First Amendment; and (3) did not violate the Religious Freedom Restoration Act of 1993 (RFRA). Tithing as a “condition of employment” is related to production of income, and it was not an abuse of discretion to limit “condition of employment” to “compensated employment” (taxpayer was not compensated). The court found it was reasonable to interpret “health and welfare” as not including petitioner’s “spiritual” health and welfare. Taxpayer’s children’s college expenses were also “conditional expenses”. Taxpayers must be able to fully pay their tax liabilities within 5 years for “conditional expenses” to be classified as “necessary expenses.” George Thompson v. Commissioner, U.S. Tax Court, CCH Dec. 59,469, 140 T.C. No. 4, (Mar. 4, 2013).