The Children’s Health Insurance Program (CHIP) is a government insurance program that provides low-cost health insurance to children from families that earn too much to qualify for Medicaid but not enough to be able to afford private insurance. This includes many pastors’ children.
CHIP Eligibility Is Based On Income
Like many such programs, eligibility is based on income. That’s simple for most people, but can be a cause of uncertainty for pastors. You start filling out the forms and when you get to the income line, you pause. Your salary is $30,000. Your housing allowance is $20,000. So what’s your income? $30,000 or $50,000? Ugh! No one else has this problem, why does being a pastor have to be so hard?
CHIP Income Calculation & The Clergy Housing Allowance
Being a pastor is hard, I know it. While I can’t fix the people in your church, I can at least solve this little problem for you. CHIP income DOES NOT include the housing allowance. That’s good news for you!
CHIP uses the same methodology for calculating income as most categories of Medicaid and the premium tax credit. This is the calculation used:
Adjusted Gross Income (AGI)
+Non-Taxable Social Security Benefits
+Tax-Exempt Interest
+Excluded Foreign Income
=Modified Adjusted Gross Income (MAGI)
Your AGI comes from your tax return, Form 1040, and does not include the housing allowance. As we can see from the above calculation, it isn’t added back in, either. If you don’t trust me, follow the link above and see for yourself.
To conclude, Pastor, now you can fill out your application with confidence. Your clergy housing allowance is not included in income for the Children’s Health Insurance Program.
6 Responses
Josh
May 2, 2022Okay what about adult Medicaid? I’m trying to sign my wife and I up for state care. My income is $35k my allowance is $24k.
Amy
May 8, 2022Josh, the housing allowance does not count as income for Medicaid unless your eligibility is based on blindness, disability, or being age 65 and older.
Josh
May 9, 2022Thanks Amy. I’m trying to sign up for Wisconsin state care (Badgercare) for my family, and they want my monthly income number. I’m thinking this “income” is my taxable income which would be minus my housing allowance, correct? So roughly 1/12 of $35k. My wife and I are both 45, with three kids under 9 and no complicating health issues.
Amy
May 13, 2022That is correct.
M
September 1, 2023What about for other programs like SNAP?
Amy
September 8, 2023I haven’t been able to find good information on how they calculate income for SNAP. If it is based on Adjusted Gross Income (from the tax return, Form 1040), then it does not include the housing allowance. If they ask for income, regardless of whether it is taxable or not, then it likely includes the housing allowance.