2206930
Hi guys, I had a few questions regarding the clergy section of taxes.
Under "Parsonage or housing allowance received" my housing allowance was entered in.
I get paid Salary, and I don't pay medicare or social security
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Yes, you can include the cost of your utilities as part of your housing expenses to eliminate paying personal income taxes on excess housing allowance.
You must select to pay self-employment tax on your wages and housing allowance unless you have previously filed for exemption.
"Generally, those expenses include rent, mortgage interest, utilities, and other expenses directly relating to providing a home."
So I use my housing allowance to cover all of my rent and I pay out of pocket for my utilities.
Does that mean that I can also include my rent along with my utilities in the "Qualifying Expense" section?
So IE:
"Parsonage or housing allowance received"
$20,000 (Box 14)
"Qualifying Expense"
$20,000 (Total Yearly Rent) + $Utilities.
Does anyone one have any more thoughts on this?
Yes, according to this link from IRS.gov, "a minister who receives a housing allowance may exclude the allowance from gross income to the extent it's used to pay expenses in providing a home. Generally, those expenses include rent, mortgage interest, utilities, and other expenses directly relating to providing a home. The amount excluded can't be more than reasonable compensation for the minister's services."
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