How do i enter clergy housing allowance?

Forum|Forum|6 years ago
June 1, 2019
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TurboTax Live Self Employed

Best answer by AnnetteB6

If your Clergy income is reported on a W-2, take a look at the first TurboTax article below for step-by-step instructions to enter your housing allowance.

If your Clergy income is reported on a Form 1099-MISC, then use the second TurboTax article below for your instructions to enter the housing allowance.

https://ttlc.intuit.com/replies/5412425

https://ttlc.intuit.com/replies/5412424

AnnetteB6Answer

If your Clergy income is reported on a W-2, take a look at the first TurboTax article below for step-by-step instructions to enter your housing allowance.

If your Clergy income is reported on a Form 1099-MISC, then use the second TurboTax article below for your instructions to enter the housing allowance.

https://ttlc.intuit.com/replies/5412425

https://ttlc.intuit.com/replies/5412424

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aquablue

I tried the second solution, using the minus sign. Then Turbo Tax could not electronically submit a form with a minus sign in it (so the Turbo Tax program informed me.) I could only print and submit my tax to the IRS through the mail. Is there a way to (1) make this easier (and easier to find while preparing my taxes) and (2) to find a way to file electronically even if there is a minus sign in the forms?

KrisD15

No, the second solution above does not use a negative, only when using the "Other Income" section which flows to Schedule 1 and then the 1040 line 8 do you use the negative sign.

If you are entering a 1099-NEC, on the housing allowance screen enter the amount as a positive number.

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PerryDianaGaines

I have used Turbo Tax in the past. In the 2019 Turbo Tax, when I enter my housing allowance in box #14 the software adds the housing allowance to my base pay for federal taxes. The housing allowance is exempt from federal taxes. I have not had this issue in the past. I assume there is a software error. How do you get this information to Turbo Tax?

DaveF1006

while it is true that the clergy housing is exempt from federal income tax but it is not exempt from Self-Employment tax. You will still enter your clergy housing using the methods that were previously mentioned and then it should not be reported for federal tax purposes but you will still need to pay Self-Employment (FICA) taxes.

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WilmaMarshall

we do not get a w-2 from our church. do we need to generate a w-2 or is their another way to claim this allowance not using w-2?

WilmaMarshall

sorry, I should have clarified...we receive housing allowance monthly from our church as approved by the church, however we do not receive a yearly w-2 form at the end of the year. We serve a small congregation and receive a monthly check for housing allowance.

CalvinD1

I am a minister who doesn't receive a salary only a housing allowance. Every time I try and enter it into TurboTax, it drops my refund by $3000. It is clearly taking out Federal & SE taxes. How do I rectify?

DaveF1006

The housing allowance is excluded from income taxes but not excluded from Social Security and Medicare. This income must be included on Schedule SE on Form 1040.

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CalvinD1

On the online software, it doesn't give me the option only to allow Social Security and Medicare unless it's not that clear. But as soon as I add my housing allowance, my refund drops dramatically. My SS & Medicare tax should be roughly $1000, but my refund is dropping $3000.

Stevama

I have found that Turbotax does not handle a minister's housing allowance properly. In addition, it does not allow you to override necessary entries in order to fix the problems created. My example is that my wife and I have additional w2s that are separate from our church organization. Turbotax includes this income on the SE form when it should not and it does not allow you to remove the amount from the form.

ShirlynW

To enter your "Parsonage allowance," here are the steps:

Open TurboTax
Federal > Wages & Income > Job (W-2) > Edit/Add.
Delete the W-2 on the screen, "Your W-2 info so far."
Add a new W-2.
Enter the W-2 > Continue until you see the screen below. Select "Religious employment."