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backyardigans547
New Member

For clergy taxes...I have a question regarding housing allowance. Our housing allowance is $11,846.01. There's a box for "Parsonage or Housing Allowance" but there's also another box for "Qualifying Expenses". Do I put this number in both boxes? or do

 
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Opus 17
Level 15

For clergy taxes...I have a question regarding housing allowance. Our housing allowance is $11,846.01. There's a box for "Parsonage or Housing Allowance" but there's also another box for "Qualifying Expenses". Do I put this number in both boxes? or do

Your housing allowance is taxable income if it is more than your qualified expenses.  Your qualified expenses are mortgage, utilities, and a few other things.  Turbotax won't let you enter a bigger number for qualified expenses, so if your qualified expenses are equal or more than the housing allowance, use the same number in both places.  If your qualified expenses were less than the housing allowance, enter the smaller number, and the difference will be added to your taxable income.

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*

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5 Replies
Opus 17
Level 15

For clergy taxes...I have a question regarding housing allowance. Our housing allowance is $11,846.01. There's a box for "Parsonage or Housing Allowance" but there's also another box for "Qualifying Expenses". Do I put this number in both boxes? or do

Your housing allowance is taxable income if it is more than your qualified expenses.  Your qualified expenses are mortgage, utilities, and a few other things.  Turbotax won't let you enter a bigger number for qualified expenses, so if your qualified expenses are equal or more than the housing allowance, use the same number in both places.  If your qualified expenses were less than the housing allowance, enter the smaller number, and the difference will be added to your taxable income.

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*

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noahf1981
New Member

For clergy taxes...I have a question regarding housing allowance. Our housing allowance is $11,846.01. There's a box for "Parsonage or Housing Allowance" but there's also another box for "Qualifying Expenses". Do I put this number in both boxes? or do

Why does the Federal and state rebate go up when you put a lower number in the qualifying expenses than what my actual housing allowence and go down when I put the same number in both boxes?
Opus 17
Level 15

For clergy taxes...I have a question regarding housing allowance. Our housing allowance is $11,846.01. There's a box for "Parsonage or Housing Allowance" but there's also another box for "Qualifying Expenses". Do I put this number in both boxes? or do

This is not official support and I can't see your file.  What should happen, is that if your housing allowance is more than your qualified expenses, the difference should be added to your taxable income.  Maybe the increased income is affecting your eligibility for some other credits.  You would need to contact customer support and ask someone there to look at your file.  When using Turbotax online, customers can't see the internal worksheets that have the calculations.
*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
tho1
New Member

For clergy taxes...I have a question regarding housing allowance. Our housing allowance is $11,846.01. There's a box for "Parsonage or Housing Allowance" but there's also another box for "Qualifying Expenses". Do I put this number in both boxes? or do

I have the same issue, let me know if you find an answer to this. It makes no sense, but I am in no way an expert.

LindaB1993
Expert Alumni

For clergy taxes...I have a question regarding housing allowance. Our housing allowance is $11,846.01. There's a box for "Parsonage or Housing Allowance" but there's also another box for "Qualifying Expenses". Do I put this number in both boxes? or do

What should happen, is that if your housing allowance is more than your qualified expenses, the difference should be added to your taxable income.  the increased income is affecting your eligibility for some other credits.  

 

This description illustrates that the lower the qualified expenses, you will have a higher income tax liability.

https://www.ecfa.org/Documents/TheMinistersHousingAllowance.pdf

“If you own your home and you receive as part of your pay a housing or rental allowance, you may exclude from gross income the smallest of the following: • The amount actually used to provide a home, • The amount officially designated as a rental allowance, or • The fair rental value of the home, including furnishings, utilities, garage, etc. Caution! The church board must designate, through “official” action and in advance of payment, the amount of the minister’s housing allowance. Otherwise, it will be “taxable income.” Caution! A minister’s cash housing allowance cannot exceed “reasonable compensation.” Idea! Make the wording of the resolution “open ended.” That way, it will remain in effect until the church revises it with a different resolution. See: IRS Publication 517 for details of amounts allowable for parsonage allowance. The Minister’s Housing Allowance 3 You must include in gross income the amount of any rental allowance that is more than the smallest of your reasonable pay, the fair rental value of the home plus utilities, or the amount actually used to provide a home.”

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