[Q & A] Tax Breaks for Ministers With No Housing Allowance?

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Find out¬†whether there are any housing related tax breaks available to a minister that doesn’t receive a housing allowance.

Video Transcript:

Hi, Belinda Whitfield and today is open Q&A day and I’m taking a question from my inbox and the questions is:

Currently, I do not receive any compensation from the ministry [apparently, this is a pastor] are there any housing allowance related items or expenses that we incur that can be written off on our taxes?

Well, if you are not receiving a housing allowance, that’s not a good thing for you. But in any event, you can still take the normal tax deductions that homeowners can take. You can claim a tax deduction for your mortgage interest that you are paying and as well as your property taxes on your home. You can claim those deductions on Schedule A of your tax return.

If you still have any questions, visit my website at churchcpa.com. Just go to my contact us page and submit your questions. Thank you so much and have a great day.

Authored by: Belinda Whitfield

Belinda Whitfield is a Certified Public Accountant. Her firm Whitfield & Associates specializes in helping churches and non-profits obtain their 501c3 status, get control of their finances and stay in compliance with IRS and state guidelines.

There are 2 comments for this article
  1. Pamela Bates at 4:02 PM

    Hi Belinda,

    A little confused on Clergy Foreign missions travel expenses…I have read pub. 517 and i am not clear on the percentage and deductions they can take..3/4 of the trip was donations, but 1/4 clergy personally spent..Can you shed some light on deductions for personal tax returns as far as what clergy can deduct and what they can not?

    • Belinda Whitfield Author at 5:10 AM

      Hi Pamela,

      There are so many rules concerning tax deductions for travel expenses. Seeing that you’re considering your travel expenses as a donation, you’ll want to have a look at IRS Publication 526, page 5 for more details.

      If you are a minister performing foreign travel on behalf of your church, I would recommend that the church pay all related travel expenses. If you know the trip is important in fulfilling the church’s purpose and mission and the church cannot cover the expenses, I would recommend that you keep the transaction clean and simple. Make a contribution to your church. Yes, write a contribution check to your church, just as you would for your tithes and offerings. Then let the church pay the travel expenses from the church bank account. This way your contribution will be reflected on the annual contribution statement, and qualify as a tax deduction.

      This rule applies for all church business related travel as well, including ministers, leadership and church growth conferences.

      I hope this helps.
      Belinda Whitfield

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