Is The Pastor’s Housing Allowance Worth Paying SECA?
From time to time, I get an email from a pastor asking me if the clergy housing allowance is worth the cost of paying self-employment taxes. Would it be better to give up the housing allowance and be treated as a non-minister employee? This is a particularly gnawing question in Texas where they don’t have state income taxes. Pastors Can Choose Whether To Be Treated As Ministers Let me start by confirming that pastors can make that choice. I first heard of that from a man who worked at the IRS for decades and now does consulting. He helped write the IRS tax guide for ministers, so I’m willing to take him at his word. Pastors can decide if they want to be treated as ministers or as non-ministerial employees. However, that’s not something they can flip back and forth on every single year. Make a decision and that’s how you’ll be treated ...
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