Can housing expenses offset other retirement benefits?

by Traci
(Trinity, FL)

My father is a retired minister, but is working for a small church that gave him $6,000 for the year toward health insurance. He wants to know if he can offset either his social security benefits or his wife's pension income with the housing expenses for a minister? I think not. He could offset the $6,000, which would be non-taxable. He did not receive a 1099. The estimated annual housing expenses are about $15,000. He does not receive any other income himself besides the social security benefits.

Comments for Can housing expenses offset other retirement benefits?

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Nov 28, 2012

Minister Retirement Plans
by: Vickey

You are correct. He could not offset the $6,000 with housing expenses.

The church would have to designate the $6,000 as a housing allowance and then all future payments would be exempt from income tax and possibly SE taxes...if set up correctly.

Same thing goes for health insurance. If the church is just giving him a check and saying it can go for insurance...it would be taxable income for him...but if set up properly...it could be nontaxable.

I would consult a knowledgeable financial institute such as GuideStone Retirement.

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Join in and write your own page! It's easy to do. How? Simply click here to return to Clergy Tax Q&A.

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Note: I am a "partner" of Gusto, but as I have told you before ... I never recommend anything that we or our clients have not tried and love =)

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