Frequency of change of parsonage allowance

by Tommy

Are there limitations on how frequent the parsonage allowance can be changed?

We increased the amount for our Rabbi when her rent went up in June. She and her husband are now planning to move and she has requested another increase.

Our board passed a resolution that each rabbi could request a review of parsonage allowance not more frequently than every 12 months.

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Amending a Housing Allowance Rules
by: Vickey

It is perfectly legal to amend a minster's housing allowance any time during the year if a few rules are followed.

See my comment on this post for those rules:
Can Housing Allowance Increase During the Year

However, it is a different story if the church has passed a resolution forbidding amending the minister's housing allowance. I'm mot sure why a church would do that though. Things happen...roof leaks, water heater goes out, etc. Things that cannot be planned ahead of time.

You can avoid amending housing allowances altogether by creating a housing allowance designation of up to 100% of a minister's salary.
See this article on StartChurch: Best Way to Set up Housing Allowance

At the end of the year or beginning of the next year the minister would need to fill out a housing expense form and that amount would go in Box 14 of their W-2...the rest would be reported in Box 1 as wages.

by: Sandi

If you have a written policy of 12 months you need to stay with that.
However you can change your policy and if the church feels the adjustment is required they may make the change.. never for past months....only future...
be careful of private benefit/inurment issues...
and remember even if the church doesn't make the adjustment to the base pay/housing percentage the pastor may claim legitimate expenses on their own taxes when filed...
Our church gives a set amount yearly (comparable to school teachers in the area as we don't have comparable for local pastors), anything over or under they make the adjustments on their own taxes... easy for the church and the pastor, no need to address more than once a year...
Hope this helps,

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