by Rena' Patterson
(Birmingham, AL USA)

is it mandatory or mandated by law that the Pastor be issued a w-2 for his compensation? can a Pastor request to receive his compensation as a Housing allowance only, and can prove the his housing expenses do add up to that dollar amount?

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100 Percent Housing Allowance
by: Vickey

That gets really complicated.

See the bottom question on this article:

I personally believe it would save confusion later to just go ahead and issue him a W-2 with zeros in the appropriate boxes and the housing allowance reported in Box 14.

But I do want to caution you and your Pastor that if he doesn't have another source of income for all of his other expenses, it will as Pete stated throw up a red flag with the IRS.

by: Rena'

I am aware that HA is subject to SS taxes, however, the Pastor has elected not to be paid a salary (help w/finances at the church)just a HA. His wkly allowance is less than $1,000 which will actually help w/his housing expenses. Can he receive a HA and not be a W-2 if he requested it?

Does he have to be paid a salary and a HA?

Housing Allowance as compensation
by: Pete

Because Housing Allowance is a benefit and not subject to federal income tax, using it as compensation alone is a no no and the IRS will not be very happy.

It is subject to Social Security however.

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