Clergy Taxes

We recognize the unique and complex nature of taxes for pastors. The following information will help you understand the federal income tax rules.

Housing Allowances

A minister’s housing allowance, sometimes called a parsonage allowance or a rental allowance is excludable from gross income for income tax purposes, but not for self-employment tax purposes. The housing allowance amount is always excluded from federal income.  This means churchwide organization excludes this amount from Box 1 of the W-2.  Payroll will, however, put this amount in Box 14 of the W-2 which is merely an information item.

More information:

You should always check with your own tax advisor for personal questions or concerns about the housing allowance or other tax issues.