The election of Pope Leo XIV, the first American-born pontiff, has brought with it not only new spiritual leadership but also an unprecedented tax question: Must an American pope report income and pay taxes to the U.S. Internal Revenue Service (IRS)?
Tax experts explain that the case of Leo XIV is unique because the United States is one of the few countries that requires its citizens to pay taxes on their global income, regardless of where they reside.
According to Professor Caroline Bruckner, a tax specialist at American University in Washington,
“If you are a U.S. citizen and live outside the U.S. for a full year and earn income, you generally must file a return like any other taxpayer.”
Pope Leo XIV is said to have had an estimated annual income of $400,000, including salary and benefits such as housing, food, and transportation.
That figure would place him in the second-highest federal tax bracket, with a rate of 35%.
Although like his predecessors, the Pope is not expected to receive a formal salary, he could generate income through lectures, publications, or special events.
Even if that money is donated entirely to the Church, it could trigger an IRS tax return.
“The Foreign Earned Income Exclusion allows some citizens to exclude a portion of that income, but that doesn’t exempt them from filing,” Bruckner clarified.
Furthermore, the outlook is complicated by Pope Leo XIV’s new responsibility at the head of the Vatican Bank.
Although Pope Francis signed an agreement with the United States in 2015 to require Vatican accounts to comply with banking transparency requirements, it was never anticipated that an American citizen could serve as pontiff.
When asked, Acting IRS Commissioner Michael Faulkender admitted he had no definitive answer:
“It depends on where the income is generated. I don’t know enough about Pope Leo, but I think he’ll generate income in the United States. I don’t know enough about his citizenship to know if he would have to pay taxes.”
The situation poses an unprecedented diplomatic and fiscal dilemma.
It remains unclear whether the Vatican will take action or whether Leo XIV himself will decide to renounce his American citizenship to avoid legal conflicts with the IRS.