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TandTsmom
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My hubby is a Pastor. Our church does not give us a housing allowance because we live in a church owned parsonage but they pay our utilities (don't receive a bill).

How do I treat this?  Also we did not pay social security or medicare taxes so do we pay self-employment taxes on both the housing and social/medicare?
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My hubby is a Pastor. Our church does not give us a housing allowance because we live in a church owned parsonage but they pay our utilities (don't receive a bill).

You must pay self-employment tax on the value of the parsonage plus utilities plus any cash (money) wages.  Wages should be reported in a W-2 box 1.  Generally boxes 2-6 will be blank.  If boxes 3-6 have amounts that means the church withheld social security and turbotax won't be able to handle the return without making manual adjustments.

After entering the W-2 there is a page for special circumstances, check the box for religious wages.  You will be asked about your housing allowance or parsonage value and your housing cost.  You will enter the same number in both places.  Your housing value is the fair market rental value of the parsonage -- what it would cost to rent the same or similar house in the same neighborhood to a stranger -- plus the church paid utilities.  Generally the church should inform you of these numbers in box 14 of your W-2 or in a separate memo.  If in box 14, make sure to enter it in the housing section as well since it doesn't carry over from the W-2 screen.

The value of the housing is not subject to income tax but it is subject to self employment tax.

See here for more. http://www.ecfa.org/PDF/2016-Preparing-Tax-Returns-For-Clergy.pdf


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