Howdy,
I receive a W2 with the unused portion of my housing allowance in Box 1.
I added this W2 amount in Turbotax, then continued through, selecting "Religious employment", and then on the Clergy Housing screen entered my Housing Allowance and Qualifying Expenses.
The difference between my Housing Allowance and Qualifying Expenses is the amount that was reported in Box 1 on my W2.
Turbotax proceeded to include BOTH the amount I reported from Box 1 of my W2, PLUS the difference between my Housing Allowance and Qualifying Expenses, on Form 1040 line 1. The result was Line 1 was showing exactly twice as much income as it should.
What am I missing? Where did I go wrong?
Thanks for any help!
If you received a W2 for unused parsonage so that it can be included in your gross income, you must decrease the amount in the TurboTax entry so that you are not double taxed.
The Internal Revenue Code provides clergy with an exclusion from gross income commonly known as the “housing/parsonage exclusion.” Section 107 of the Internal Revenue Code reads as follows:
In the case of a minister of the gospel, gross income does not include:
1. The fair market rental value of a church-owned home provided as part of his compensation
2. The part of his compensation designated as housing allowance, to the extent used by him to rent or provide a home.
Thanks for the workaround. That's what I had already done, but I thought I might have been doing something wrong. Thanks again @MaryK4