How do I enter a parsonage or housing allowance reported on a W-2?
To enter your parsonage or housing allowance on your W-2, choose your product and follow the steps. These instructions will work if your housing allowance is included in box 1 of your W-2. If it's not in box 1, it may result in an over adjustment of income.
TurboTax Online
Open or continue your return.
Go to W-2.
When you get to Box 14, enter Clergy Housing in the Description box, followed by the amount. (The amount might be reported to you in a letter from the church or in your employment contract if not on your W-2.) If the allowance isn't automatically classified as Other (not classified), select this option from the dropdown menu. Select Continue.
If you get additional screens, answer those questions.
When you reach the Let's check for uncommon situations screen, check the box for Religious employment, then select Continue.
On the following screen, choose Clergy and select Continue.
Enter your allowance on the Okay, Tell Us About your Clergy Housing screen. For Qualifying Expenses, enter the lesser of:
Your qualified housing expenses
The fair rental value of your housing expenses
Your housing or parsonage allowance
Select Continue, and on the Clergy Self-Employment Tax screen, choose the appropriate option and Continue again.
When you see the Your W-2 summary screen, select Edit to view your W-2 information. If the Box 1 amount hasn't been adjusted for your housing allowance, enter a Line 21 adjustment to income. Here's how:
Go to other reportable income.
Answer No to Did you receive any other wages? and select Continue.
Scroll to the bottom of the Miscellaneous Income screen and choose Start next to Other reportable income.
Answer Yes, and on the 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).
TurboTax Desktop
Open or continue your return.
Search for W-2 and select the Jump to link.
Follow the instructions to import or manually enter your W-2.
When you get to Box 14, enter Clergy Housing in the Description box, followed by the amount. (The amount might be reported to you in a letter from the church or in your employment contract if not on your W-2.) If the allowance isn't automatically classified as Other (not classified), select this option from the dropdown menu. Select Continue.
If you get additional screens, answer those questions.
When you reach the Let's check for uncommon situations screen, check the box for Religious employment, then select Continue.
On the following screen, choose Clergy and select Continue.
Enter your allowance on the Tell Us About your Clergy Housing screen. For Qualifying Expenses, enter the lesser of:
Your qualified housing expenses
The fair rental value of your housing expenses
Your housing or parsonage allowance
Select Continue, and on the Clergy Self-Employment Tax screen, choose the appropriate option and Continue again.
When you see the Your W-2 summary screen, select Edit to view your W-2 information. If the Box 1 amount hasn't been adjusted for your housing allowance, enter a Line 21 adjustment to income. Here's how:
Search for other reportable income and select the Jump to link.
Answer No to Did you receive any other wages? and select Continue.
Scroll to the bottom of the Let's Work on Any Miscellaneous Income screen and select Start next to Other reportable income.
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).
