Does a Pope's Papal Salary Come With a U.S. Tax Bill?

When Pope Leo XIV assumed his position, he became not just the leader of 1.3 billion Catholics worldwide — he also became a potential taxpayer for the United States government. As an American citizen born in Chicago (formerly Robert Prevost), the new pontiff faces a unique situation: he may be legally obligated to file U.S. income taxes on his ecclesiastical compensation, despite leading the world’s oldest religious institution.

The American Citizen Tax Trap

The irony is striking. While religious organizations typically enjoy tax-exempt status in America, this protection does not automatically extend to individual clergy members’ personal income. According to tax experts, U.S. law asserts jurisdiction over all American citizens’ worldwide earnings, regardless of where they live or what role they occupy.

“The foundational principle is clear,” explains Edward A. David, a theology professor at King’s College London. “U.S. citizens face taxation on global income without blanket exemptions, even for religious figures.” Timothy Fogarty, an accounting specialist at Case Western Reserve University, reinforces this point: diplomats, heads of state, and religious personnel all fall under the same taxable framework — there is no categorical exception carved out for any of these groups.

Calculating the Pontiff’s Potential Tax Burden

The papal salary structure is straightforward in monetary terms. Pope Leo XIV receives approximately 30,000 euros monthly, equivalent to roughly $33,000 per month or $396,000 annually. If this full amount were subject to U.S. taxation without any deductions, the federal and state self-employment tax obligation could reach approximately $135,287 per year — a substantial sum even for a religious leader.

Deductions and Religious Worker Status

However, the situation becomes more nuanced when deductions are considered. The IRS classifies clergy members as self-employed individuals for Social Security and Medicare purposes, which opens certain tax-reduction possibilities.

The pontiff could potentially claim the standard deduction of $14,600, lowering his taxable income. Additionally, housing-related expenses might qualify for write-offs. Since the Vatican provides papal housing, associated costs — from furniture to utilities to maintenance — could conceivably be deducted as business expenses directly tied to his ecclesiastical duties.

The Foreign Account Complication

One thorny issue involves the overseas financial dimension of papal operations. The Vatican Bank’s holdings exceeded $6.1 billion as of 2023, and accounts tied to such international funds might superficially appear problematic under U.S. tax law. However, as long as Pope Leo XIV files the required Form 8938 with the IRS and submits appropriate Foreign Bank Account Reports to the Treasury Department’s Financial Crimes Enforcement Unit, he would satisfy his disclosure obligations.

The Real-World Practice

An important practical note: most popes throughout history have not actually claimed the salary they’re entitled to receive. Pope Francis, Leo XIV’s predecessor, declined his compensation entirely. This means that while the pontiff possesses the technical authority to collect the full annual amount and faces potential tax consequences if he does, he may choose the path of historically-minded restraint — effectively bypassing the entire tax question by simply refusing the income.

In the end, Pope Leo XIV’s situation illustrates how even the highest spiritual authorities cannot escape the long arm of American tax jurisdiction, though the actual enforcement scenario remains largely theoretical given established papal practice around material compensation.