Per Pub 517, ministerial expenses are only allowable Sched C deductions up to the percentage of my taxable income. How do I figure this in TurboTax? It doesn't address it

raviolio · ‎June 1, 2019

In IRS Pub 517, there are three worksheets to help figure my allowable ministerial deductions.

1. Figuring the Percentage of Tax-Free Income

2. Figuring the Allowable Deduction for Schedule C Expenses**This is the important one I can't figure out how to address.

3. Figuring Net Self-Employment Income for Schedule SE (Form 1040)

Doing this shifts my nondeductible Schedule C expenses by about $2,000. However, I cannot find anywhere in TurboTax that addresses this required calculation/adjustment.

On some forum, I read that you can "override" Sched C line 28 to enter the correct figure, so I tried that, but now TurboTax keeps insisting it is an error and won't let me complete my taxes.

I am trying to be honest with my taxes, as this benefits the government, not me. Please help.

(I quit using TurboTax several years ago because of all my frustrations with trying to figure out how to do clergy taxes, and went to a private CPA who showed me how to do it all correctly. But the $400 price is so steep I decided to return to TurboTax this year since I thought I knew what I was doing...but apparently this program is more strong-willed than I!)

KarenJ · ‎June 6, 2019

Please see the 2019 Ministers' Tax Guide for 2019 Returns. There are examples of worksheets and tax returns prepared in TurboTax.

https://www.guidestone.org/TaxGuide

Yes, you will need to override Line 28 on Schedule C in the Forms view to reflect the decreased expenses allowable. TurboTax should let you finish and print your return for mailing. You need to mail your return anyway in order to attach the worksheets to you return.

In order to decrease your wages on the Sch SE for your business deductions, please enter your business deductions on line 5c of the SE Adj Wks in the Forms mode.

Please see the attached screen shots.

Please let me know if you have additional questions.

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raviolio · ‎June 6, 2019

Thank you.

Per Pub 517, ministerial expenses are only allowable Sched C deductions up to the percentage of my taxable income. How do I figure this in TurboTax? It doesn't address it

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