HA Paid to an Hourly Paid Clergy

by Ron Ritchie
(Harrisburg OR)

Question regarding housing allowance paid to a part-time pastor:

We have a part time pastor that works on an hourly basis. At the beginning of 2009 we allocated up to $1,200 per month for housing allowance.

He has not gone over that amount per month in 2009. However, he had asked to have some federal and state tax withheld from his check for other tax reasons.

My question is this; Do I give him a W-2 with the HA in box 14 as other income and the tax withheld in their proper boxes?

Please advice.

Answer

Yes, you could report in box 14 or you could just include the amount of the HA in a separate letter to the minister. (This separate letter should not be sent to the IRS and will not be included or attached to the minister's personal tax return.)

The income tax already withheld would be reported in their proper boxes on the W-2. Make sure the amounts equal the total of the amounts sent in on your quarterly 941 forms.

Hope this helps,




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