What Is a Typical Clergy Housing Allowance?


Quick Answer

A typical clergy housing allowance is about a third of a clergyman's annual income. A pastor who earns an average salary of $50,000 can expect an additional $16,000 to cover housing costs. As of 2015, clergy housing allowances are tax free for income-tax purposes but not for self-employment-tax purposes.

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Full Answer

The practice of providing clergy with housing allowances stemmed from the old practice of churches providing clergy with free housing in church-owned parsonages. As churches with parsonages dwindled in number, the churches substituted parsonage housing with a monetary housing allowance. Tax-exempt clergy housing applies to about 44,000 clergy in the United States, such as priests, pastors, ministers, rabbis and imams. The justification for tax-exempt housing allowances stems from the assumption that clergy perform many of their tasks and duties at their places of residence, such as making phone calls, holding meetings, counseling, preparing sermons and reading ministry-related literature, which make them home offices.

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