Pastors Housing Allowance Annual Designation

by Johnson Tony
(Charlotte NC )

If the housing allowance remains the same each year does it have to be recertified each year ?

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Designate Housing Allowance IN ADVANCE of the tax Year
by: Vickey

Read IRS's Pub 1828 AND Pub 517.

From PUB 517:
"An official designation of an amount as a
housing or rental allowance may be shown in
an employment contract, in the minutes of a
church or qualified organization, in a budget, or
any official action taken in advance of payment
of the allowance.

Most church "experts" interpret that as the requirement that the housing allowance be designated and approved before the tax year begins and recommends the official governing body designate that amount in December.

Guidestone.org states: "Churches should consider designating a housing allowance "for the current year and for all future years unless otherwise provided." This "safety net" allows a designation to carry over from year to year, preventing problems if a church forgets to designate an allowance one year. However, safety net allowances should not be viewed as a substitute for designating a housing allowance each year."

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