Housing Allowance on a Church owned house

We have a church owned mission house.

At this time, we have a previous IMB missionary living in the house.

He has joined our staff for now and has been given permission by the church to live in the church owned fully furnished house with utilities paid by the church for at least 2 years.

I'm not sure how to account for a housing allowance for him. He currently gets paid $55000/year with nothing reported as housing allowance.

Wasn't sure how to set his salary up correctly.

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Mar 29, 2021
Figuring the Fair Rental Value (FRV) plus the Cost of Utilities for a Parsonage
by: Vickey

It is taxable on a SE tax level and some churches will help figure the fair rental value (FRV) of the parsonage and report it and the cost of utilities in Box 14 of the minister's W-2.

But ministers are ultimately responsible to figure and report that on their SCH SE on their personal income tax return.

Here is an article that helps with that figure: https://www.freechurchaccounting.com/fair-rental-value.html

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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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