Housing allowance and 1099

by Rickie
(Garland, Texas)

Yes, my question is this. I am an elder in a church that helps with the support of a number of men who do not preach for us locally.

One of our men has requested that we designate the amount we support him as his housing allowance. No problem.

My question is do we then issue him a 1099?

According to what I have read in the Church and Clergy Tax guide, chapter 6 page 274 a 1099 is not necessary.

However, my treasurer, who is a diligent CPA, is asking for support from the tax code, IRS regulations or court rulings to support this. Can you help me?

Comments for Housing allowance and 1099

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Apr 05, 2013
housing and 1099
by: Sandi

Please look to the left and scroll down to Housing Allowance section...
Only Employee's may receive housing allowance and it must be pre approved....
There are other rules that apply also but you should ask your CPA why is a 1099 being used instead of a W-2...

(the following is copied from the housing allowance section)

"Can non-minister employees receive an allowance for housing?

No. To receive the special tax treatment of a ministerial housing allowance, the employee must meet the IRS’ 5-test definition of a minister found in section 107 of the IRC. See this page on clergy taxes for more details."

IRS Pub 15a:
"Form W-2. If your minister is an employee, report all taxable compensation as wages in box 1 on Form W-2. Include in this amount expense allowances or reimbursements paid under a nonaccountable plan, discussed in section 5 of Publication 15 (Circular E). Do not include a parsonage allowance (excludable housing allowance) in this amount. You may report a designated parsonage or rental allowance (housing allowance) and a utilities allowance, or the rental value of housing provided in a separate statement or in box 14 on Form W-2."

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