We recognize the unique and complex nature of taxes for pastors. The following information will help you understand the federal income tax rules.
- Clergy Tax Tips
- Exemption for Self Employment Form
- IRS Earnings for Clergy
- Questions About Tax Status (ELCA)
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.
- Clergy Housing Allowance Information from ELCA Portico Benefits Services (BOP)
- Ministers’ Compensation & Housing Allowance from the IRS
- Social Security and Other Information for Members of the Clergy and Religious Workers publication from the IRS
You should always check with your own tax advisor for personal questions or concerns about the housing allowance or other tax issues.