housing allowance paid to or for the pastor

by delsa
(OH)

how to handle: pastor housing expense is paid for him by the church, instead of him receiving a housing allowance?

Comments for housing allowance paid to or for the pastor

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Feb 08, 2014

Your church is creating taxable income for the pastor
by: Bill OConnell

Your church is likely creating taxable income for the pastor. Unnecessarily.

Your question does not have sufficient detail to provide a precise answer. However, this appears to be a case where the church is paying personal expenses on behalf of the pastor. This is a condition that creates taxable income AND income that is subject to the Self Employment tax.

This is the worst of all possible tax conditions. I suggest you consult with a qualified CPA who is familiar with clergy compensation and taxation.

My firm may be found at www.wisdomoverwealth.com.

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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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