Gas Allowance

by Jan

Our church has a charge account at one of the local gas stations. Pastor and staff is able to charge gas and the church is billed monthly for the gas purchases. Is this an allowable expense?

Know the answer? Face the same situation? Please post your answer or comment by using the "comment" link below. Thank you!

Comments for Gas Allowance

Average Rating starstarstarstarstar

Click here to add your own comments

Feb 22, 2011
pastor's gas allowance
by: Anonymous

My husband is a pastor, and our church has this type of gas allowance for him. We charge the gas at the convenience store which bills the church.
We received our W-2 from the church and this amount is not included. Is it possible to claim this amount somewhere else, such as line 21 of form 1040?

Dec 31, 2010
Gas Allowance
by: Jan (Texas)

Thanks, Donna. From the time since I posted the question, I attended a church tax compliance conference and found out that gas is not an allowable expense. The correct way is to reimburse mileage through the accountable reimbursement plan.

Dec 30, 2010
gas/mileage payment
by: Donna

From what I have read, a gas allowance is fully taxable to him/her as income. They may deduct, as a miscellaneous itemized deduction, their vehicle expenses or mileage. However, those deductions can only be taken for the amount that exceeds 2% of the adjusted gross income. Additionally, if he/she does not itemize they lose the whole deduction, but still has income. This is referred to as a non-accountable plan.

Under an accountable plan, they would submit mileage logs and expense reports to the church,
who would reimburse them at the current IRS rate for mileage. This is an accountable plan and
the payments to them are not taxable, and the mileage/expenses are not deductible by the pastor.

Click here to add your own comments

Join in and write your own page! It's easy to do. How? Simply click here to return to AR Plan.

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 =)

Share this page:
Enjoy this page? Please pay it forward. Here's how...

Would you prefer to share this page with others by linking to it?

  1. Click on the HTML link code below.
  2. Copy and paste it, adding a note of your own, into your blog, a Web page, forums, a blog comment, your Facebook account, or anywhere that someone would find this page valuable.