According to court documents the longtime financial director…received $132,019 out of his total $144,261 compensation in the form of a housing allowance last year. The Reformed Church in America had no record of his ordination as a pastor.
Crystal Cathedral, the Orange County mega-church that filed for bankruptcy last month, allowed its chief financial officer to skirt federal income taxes by paying the bulk of his salary in the form of a housing allowance, a benefit reserved under law for ministers.
The six-figure housing allowance paid to financial officer Fred Southard -– along with compensation to members of the church founder’s family –- are among the expenses questioned by the U.S. trustee’s office and the creditors’ committee assessing the bankruptcy case.
The documents also suggest that the church paid at least three insiders for redundant duties. The filings give the first look into the long-questioned financial practices of the Garden Grove church, which employs more than a dozen family members and in-laws of founder Robert H. Schuller.
The Crystal Cathedral has cited the weak economy and a 24% drop in donations in 2009 for its financial problems. More than 550 creditors are owed $50 million to $100 million, according to the initial bankruptcy filing last month…
Southard has been the Crystal Cathedral’s chief financial officer since 1978 and owns a home in Newport Beach valued at $2.3 million.
Federal tax law allows religious organizations to give a housing allowance to “ordained, commissioned or licensed ministers” who perform certain duties for the church. The allowance is exempt from federal income tax.
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