Clergy Housing Allowance AND Parsonage

[landress1999]

My husband is a pastor and the church gives us a housing allowance to cover utilities, etc AND we live in a parsonage rent free.  The housing allowance is listed on line 14 of the W2 but the fair rental value of the house is not listed there.  How do I account for both of these in turbotax?

[Opus 17]

The church should inform you the fair market value of the parsonage. They could have included it in box 14, or they should issue you a separate memo. In TurboTax, after you enter the W-2 and continue to the next screens, there is a page listing special circumstances. Check the box for religious wages. When you are asked for the value of your housing allowance, enter the combined value of the cash allowance plus the fair market value of the parsonage.

[landress1999]

I did that!  Then under qualifying expenses I also enter the cost of my utilities etc. + the fair market value correct?  

[Opus 17]

If your qualifying expenses were less than provided by the church you would enter the lower number, since the amounts spent on non-qualified expenses becomes taxable.  As long as your expenses were equal or more than the provided amount, you would enter the same number in both boxes (you don’t get an extra tax break if your expenses are more than the allowance.  You would have to ask the church to change the designated amount.)

[landress1999]

In our situation I enter the amount designated for utilities, etc. (box 14) PLUS the fair market value of the home that we live in rent free.  Under qualified expenses, do I only enter the amount I spent on utilities, etc. If I do this (exclude the fair market value from my qualifying expenses), my qualifying expenses total is much less than my housing allowance recieved.  Is this correct?

[Opus 17]

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@landress1999 wrote:

In our situation I enter the amount designated for utilities, etc. (box 14) PLUS the fair market value of the home that we live in rent free.  Under qualified expenses, do I only enter the amount I spent on utilities, etc. If I do this (exclude the fair market value from my qualifying expenses), my qualifying expenses total is much less than my housing allowance recieved.  Is this correct?

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With a parsonage, include the value of the parsonage (as determined by the church) with your other expenses.