HSA Paid as an Allowance directly to Pastor

by Kimberly

My church pays an HSA as an allowance directly to one of our pastors, rather than into the pastor's HSA.

The pastor then deposits it into an HSA managed by his bank.

Is this taxable pay to the pastor? Or is it treated like a housing allowance?

If taxable as paid directly to the pastor, would it not be taxable pay if the church paid the money into the HSA directly? Note: this pastor has requested that we withhold federal and state income tax from the salary portion of his pay.

If the HSA allowance is also taxable, should we withhold income tax from the HSA allowance as well?

Secondary question: If we pay into an HSA for anyone, are we required to make that available to everyone who works for the church?

Click here to post comments

Join in and write your own page! It's easy to do. How? Simply click here to return to Minister's W-2.

Need training on how to use QBO or Aplos effectively for a church or better yet ...need an expert in either of those accounting software to do your monthly bookkeeping and/or payroll? See more on our accounting services!

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.