Housing expenses are not a tax deduction, but they may be excludable from income if set up properly.
If you live in a parsonage provided by the church, then the fair market value of the rent, plus any utilities the church pays, are not taxable income to you (even though such a benefit would be taxable to a secular CEO). You are required to pay self-employment tax on the value of your housing, but not income tax.
If you don't live in church-paid housing, the church has the option to designate a portion of your income as a housing allowance. This must be done in advance and in writing. The housing allowance is subject to self-employment tax but is not subject to income tax as long as you use it for qualified housing expenses. If the housing allowance is more than your housing expenses, the difference is taxable income.
When you enter a W-2, there is a page of special circumstances. Check the box for religious wages. turbotax will then ask for the amount of your housing allowance or fair market value of parsonage, and your qualified housing expenses. In most cases, both numbers will be the same and this will result on you paying self-employment tax but not income tax on your housing expenses.
If you don't have a properly designated housing allowance, there is no way to deduct your housing expenses. So talk to your local church board about putting one in place right away.
See this for more. http://www.ecfa.org/PDF/2016-Preparing-Tax-Returns-For-Clergy.pdf
