topic Pastor/minister deduction - living expenses in Deductions & credits

Pastor/minister deduction - living expenses

mteverest — Thu, 06 Jun 2019 05:45:52 GMT

I live in a house that I own and my church did not set up a "housing allowance." Essentially I am getting a 1099 with the entire compensation in box 7. Can I deduct (on schedule C or elsewhere) things like property tax, utilities, home repairs, and even other living expenses, etc?

Unfortunately, the IRS requires "The minister's employing...

RichardG — Thu, 06 Jun 2019 05:45:54 GMT

Unfortunately, the IRS requires "The minister's employing organization must officially designate the allowance as a housing allowance before paying it to the minister." Unless your church designated part of your payment as a housing allowance, you are not entitled to those deductions. You can still deduct your property taxes and mortgage interest on Schedule A.

It costs the church nothing to do this. So why won't the...

Opus 17 — Thu, 06 Jun 2019 05:45:55 GMT

It costs the church nothing to do this. So why won't they?
<a rel="nofollow" target="_blank" href="http://www.ecfa.org/PDF/2016-Preparing-Tax-Returns-For-Clergy.pdf">http://www.ecfa.org/PDF/2016-Preparing-Tax-Returns-For-Clergy.pdf</a>

However, you probably should not be getting a 1099-MISC. Even though pastors are considered self-employed for some income tax purposes, if you answer to the congregation (directly or through a board) or to a denomination (district, etc) then you are a common law employee and should get a W-2 with your wages in box 1 and boxes 2-6 blank. The church should be filing form W-3 and form 941 or 944, not giving you a 1099. Your treasurer or finance committee may need some education, your denomination may have resources.