How To Calculate The Clergy Housing Allowance
The following is an excerpt from my book, The Pastor’s Wallet Complete Guide to the Clergy Housing Allowance: Calculating By now you understand who is allowed to take a clergy housing allowance and the process by which you can do so. But here’s the big question everyone has: how do you know how much of a housing allowance to request? First of all, there are limits to the amount of housing allowance that the IRS will allow you to claim. Your maximum allowed housing allowance is the least of: the amount actually used to provide or rent a home; the fair market rental value of the home (including furnishings, utilities, garage, etc.); the amount officially designated (in advance of payment) as a housing allowance; or an amount that represents reasonable pay for your services. That means that even if your mortgage payment is $2,000 a month, if you could only rent the home (furnished, with utilities) for $1,500 ...
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