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posted May 29, 2023 1:52:18 PM

Clergy Housing Allowance

I have religious employment with a university.  I received a letter stating that I have a portion of my salary, $3,100/month will be designated as clergy housing allowance.  This amount was not listed on my W2s anywhere.

 

I've researched how to report it, and am seeing different options, such as:

 

1) Report in Box 14 (when I do this, it does not reduce the wages in box 1)

- It goes on to ask housing allowance received and qualifying expenses. When I enter the amount, per the letter, it actually increases my taxes owed as I suppose this way is actually adding to the salary instead of decreasing the salary.

2) Report as Misc Income and enter as a negative number (this way does actually decrease the amount of taxes owed, but not sure it if is totally correct).

 

Please advise,

 

Thank you

 

 

 

0 5 2120
5 Replies
Level 15
May 29, 2023 1:55:41 PM

https://turbotax.intuit.com/tax-tips/self-employment-taxes/ministers-and-taxes/L2EiSFEMT

Level 15
May 29, 2023 2:30:41 PM

See the following FAQ.


How do I enter a parsonage or housing allowance reported on a W-2?

 

Level 1
Feb 9, 2026 6:02:42 AM

I have used the method linked the article (here) (entering negative number in other reportable income) for several years and have never had a problem with it. This year (2026 for tax year 2025) when the review happens it claims that other reportable income cannot be a negative number. 

 

My W2 just states my total salary and does not account for clergy housing. Even if it does, the software never exempts the salary from federal taxes. 

 

I'm confused where to go at this point to enter my clergy housing allowance in such a way that the amount is exempt from the federal taxes, as any other place you enter it it assumes that as ADDITIONAL income over and above what is listed on the W2.

 

Help. 

Employee Tax Expert
Feb 9, 2026 6:27:47 AM

Instead of using the steps at the bottom of the TurboTax help article that take you to the section to enter the negative adjustment for your housing allowance, try following these steps instead:

 

  1. In the Income section of your return, scroll to Less Common Income.
  2. Click Start or Update beside Miscellaneous Income, 1099-A, 1099-C.
  3. Scroll to the bottom of the Let's Work on Any Miscellaneous Income screen and select Start next to Other reportable income.
  4. Answer Yes, and on the Any Other Taxable Income screen, type Clergy Housing Allowance in the description and enter it as a negative number (precede it with a minus sign, for example -10,000).

 

This will report the housing allowance as a negative adjustment on Form 1040 Schedule 1 line 8z.

 

@amwest6 

Level 1
Feb 9, 2026 7:22:09 AM

Following this approach worked. I was getting to that screen before via a searched link and entering the numbers right, but it seems as if something about the path of getting to that screen that you recommended changed how it was accepted.