Browsing Category Housing

I recently received an email from a missionary who had just returned from overseas. She was living with her mother for a season and had some questions as to how the housing allowance applied in her circumstances since she was not paying rent.  This situation is probably more common than a lot of us realize. Whether it’s a missionary returning from overseas, a new seminary graduate just starting out in ministry, or a pastor living with a parent in a caretaker ...

When the Federal Reserve slashed interest rates to near zero in response to the coronavirus crisis, everyone decided that it was a perfect time to refinance their mortgage. There were so many refinance requests that lenders had to artificially raise rates in order to lessen demand and give them a chance to keep up. Rates bounced around quite a bit but have spent the rest of the year near historic lows. Because of this, a lot of people have refinanced their ...

By law, a minister’s housing allowance must be designated by a church or church denomination. But what does that mean? Surely a mosque or synagogue would count since the government isn’t allowed to discriminate between religions. The IRS uses a different meaning for church than most of us do in our everyday language. Church for them has more to do with an organization’s religious purpose than their actual religion or common vocabulary. The truth is, Section 107 of the Internal Revenue ...

I’m pleased to announce that my first book is now available for sale on Amazon! The Pastor’s Wallet Complete Guide To The Clergy Housing Allowance is a comprehensive look at all things housing allowance.  The Story Behind The Book Last February, I sat down to put together a downloadable resource about the housing allowance since it is a common topic of reader questions. As I started my research, I thought to myself, you could write a whole book about this stuff!  And so ...

This is an excerpt from The Pastor’s Wallet Complete Guide to the Clergy Housing Allowance, now available for purchase on Amazon. Everyone wants a clear list of what is permissible and what is not allowed for the housing allowance. Unfortunately, that is still being figured out. Right now it just allows “expenses directly related to providing a home” and only specifically prohibits food and servants. That clear-cut list that everyone wants is still out there somewhere with unicorns and the Easter ...

The new year is just around the corner, so it’s time to be thinking about your 2020 pastor’s housing allowance. Here are a few things to keep in mind as you make your plans. Your Housing Allowance Should Be Approved In December The housing allowance for pastors is not and can never be a retroactive benefit. Only expenses incurred after the allowance is officially designated can qualify for tax exemption. Therefore, it is important to request your housing allowance and have it ...

One of the greatest financial benefits available to pastors is the ministerial housing allowance. Unfortunately, it is also one of the most misunderstood aspects of a pastor’s finances. Most pastors are aware of its existence and benefits but still have questions, like: Who is eligible to claim a ministerial housing allowance? How much housing allowance can a pastor claim? How do you calculate a housing allowance? If you want to know the answer to any of those questions, just click on the link. Today’s ...

As we enter the final stretch of 2019, it’s time to review the year’s housing expenses and how they align with your designated housing allowance. It’s always a good idea to review your housing allowance about this time of year to make sure you are maximizing your tax savings. How well your actual expenses have lined up with your designated allowance will affect what you do the remainder of the year. Free Minister Housing Allowance Calculator & Worksheets I’ve created several tools ...

For almost 100 years, since the Revenue Act of 1921, pastors in the United States have had the privilege of living in employer-provided housing without having to pay income taxes on it. Back then, it was common practice for churches to provide a home, or parsonage, for their pastors.  By the 1950s, it wasn’t quite as common. As the number of churches increased, many simply did not have the funds to provide a parsonage. This forced the pastors to find their ...

Keep your mortgage so you don’t lose your housing allowance and mortgage interest deduction! How many times have you heard that advice? A reader recently asked me about it. Is that really good advice? I know for most people, keeping a mortgage just for the mortgage interest deduction doesn’t make financial sense (though a lot of people do it). But you pastors have an amazing benefit in the ministerial housing allowance. It made me wonder, could the housing allowance be enough to ...