Expert Clergy Tax Services
Maximize the Tax Benefits of the Housing Allowance
Maximize the Tax Benefits of the Housing Allowance
Maximize the Tax Benefits of the Housing Allowance
Housing allowance should be declared before the first pay of the new year. So how do you make sure you declare enough without a crystal ball? Our proven strategy to ensure you take advantage of every income tax free dollar will help you save the maximum amount of tax possible.
Retired Clergy and Housing Allowance
Maximize the Tax Benefits of the Housing Allowance
Maximize the Tax Benefits of the Housing Allowance
Retired clergy can also take advantage of the housing allowance by excluding income from certain pension and retirement income. However, there are very specific rules about the source of that income and the 1099-R forms that report it. We have proven strategies to document qualified housing costs for retired clergy in order to exclude the maximum amount of retirement income possible from income tax
Unreimbursed Clergy Business Expenses
Maximize the Tax Benefits of the Housing Allowance
Estimated Tax Payments vs. Withholding
Unreimbursed employee business expenses as a deduction were generally eliminated under Trump era tax legislation. However, properly documented unreimbursed clergy expenses may still be able to be deducted against housing allowance for the calculation of self-employment tax. This is probably one of the most overlooked deduction we see on clergy tax returns. Our tax professionals will ensure you take full advantage of this deduction opportunity.
Estimated Tax Payments vs. Withholding
Estimated Tax Payments vs. Withholding
Estimated Tax Payments vs. Withholding
Clergy wages are not subject to social security or medicare withholding and housing allowance is not subject to any tax withholding at all. Accordingly, clergy must not only decide how to pay in their applicable taxes, but how much. We can provide valuable guidance on both options to remit tax, as well as how much.
Clergy IRS representation
Estimated Tax Payments vs. Withholding
Clergy IRS representation
Because of the complex and unique nature of clergy tax regulations, having representation from a highly experienced CPA can increase the chances of a successful outcome from a notice or audit.
Clergy W-2's and 1099's
Estimated Tax Payments vs. Withholding
Clergy IRS representation
Clergy can be compensated as an employee or as an independent contractor. In addition, we do not always see uniform or correct reporting for W-2 purposes by many churches, especially smaller congregations. Our tax professionals can consult with the employing organization to ensure such reporting is in accordance with the Internal Revenue Code.
Lower of Qualified Housing Costs and Fair Rental Value of Home and Furnishings and Utilities
Lower of Qualified Housing Costs and Fair Rental Value of Home and Furnishings and Utilities
Lower of Qualified Housing Costs and Fair Rental Value of Home and Furnishings and Utilities
The maximum amount of housing allowance that can be used to exclude compensation from income tax is the lesser of qualified housing costs and the fair rental value of the home, it's furnishings, plus utilities. How do you determine the fair rental value of the home and furnishings? Our proven strategies can help you determine that value.
Church Pension and Benefit Plans
Lower of Qualified Housing Costs and Fair Rental Value of Home and Furnishings and Utilities
Lower of Qualified Housing Costs and Fair Rental Value of Home and Furnishings and Utilities
Church pension and benefit plans are typically not subject to ERISA requirements like most such plans. As a result, employer benefit plans can often have features or cover employees, such as clergy, that may not be possible under an ERISA plan. Let our tax professionals assist you and your organization with understanding and evaluating your options.
Clergy, Housing Allowance and Employment with an Organization not Classified as a Church
Lower of Qualified Housing Costs and Fair Rental Value of Home and Furnishings and Utilities
Clergy, Housing Allowance and Employment with an Organization not Classified as a Church
Simply being employed ordained clergy does not by itself allow clergy to allocate a portion of compensation to housing. Instead, clergy must perform clergical duties as part of employment. For example, clergy employed as a counselor by itself would probably not qualify, but if the minister performed minsterial duties as part of the counseling program, then it likely would. Our tax professionals can help you evaluate whether your non-church wages qualify for the housing allowance exclusion.
What are Qualified Housing Costs
Weddings, Funerals and Other Income
Clergy, Housing Allowance and Employment with an Organization not Classified as a Church
Qualified housing expenses range from utilities to mortgage payments to repairs and maintenance cost as well as down payments and additions, HVAC equipment and roofs. A more detailed list is available in our Resource tax. Questions on what expenses might qualify? Let our tax professionals help you make sure you count all qualifying expenses.
Weddings, Funerals and Other Income
Weddings, Funerals and Other Income
Weddings, Funerals and Other Income
In addition to compensation from employment by a faith based organization as clergy, ministers often receive additional income for weddings, funerals, supply work and other related, but seperate sources. Such income is typically subject to income, social security and medicare tax and certain expenses can be taken against this type of income.