by Fayer

If my pastor receives a 1099 form is he still allowed to receive a housing allowance? How do we set up a housing allowance?

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Feb 05, 2013
housing allowance
by: Sandi

My question is why is your pastor getting a 1099 instead of a W-2?
but beside that question...
(from IRS Pub 1828 and this site)
In order to qualify for the exclusion from federal income tax, two very important conditions must be satisfied:

•The housing allowance must be board approved before it was paid (A housing allowance is NEVER retroactive)
•The minister actually spent the allowance on eligible housing expenses during the year

Your church must make sure the amount they are going to pay as an allowance for housing is determined before it is paid. It should be included in a board approved resolution and properly documented in the church records. Most of the time, it is reviewed and adjusted before the beginning of each new budget year.

you might want to look to the left and scroll down to the Clergy/Minister section :-)

also a good set of IRS Pubs for churches are the 15 series


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Join in and write your own page! It's easy to do. How? Simply click here to return to Minister's W-2.

If you want to DIY your payroll, I highly recommend you look at using Gusto! It is very user friendly and their support is awesome! Plus they know how to set up and maintain payrolls for churches and nonprofit organizations.

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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