Housing Allowance Resolution

What this is

A minister of the gospel may exclude from federal income tax the portion of compensation that the church designates in advance as a housing allowance, up to the lowest of (a) the amount designated, (b) the amount actually spent on housing, or (c) the fair rental value of the home, furnished, plus utilities. The allowance is still subject to self-employment tax unless the minister has an approved Form 4361. The designation must be made before the period to which it applies; a retroactive designation is worthless.

The minister must actually be a minister: ordained, licensed, or commissioned by the Church, and performing ministerial services (conducting worship, administering rites, or administering the Church). The Council should not designate an allowance for anyone who does not meet that test.

Resolution

WHEREAS [Name] is an ordained minister of Spiritual Results serving as its Presiding Minister, conducting its worship, administering its rites, and administering its affairs, and is compensated for those services; and

WHEREAS Section 107 of the Internal Revenue Code permits a minister of the gospel to exclude from gross income a housing allowance designated in advance by the employing church;

NOW, THEREFORE, BE IT RESOLVED by the disinterested elders of the Council of Elders, the minister not being present or voting, that:

1. Of the total compensation of $[amount] per [year] fixed for [Name] for the period beginning [DATE], the sum of $[amount] per [year] is designated as a housing allowance under Section 107, to be paid as part of his regular compensation and to be used to provide a home, including rent or mortgage payments, utilities, furnishings, repairs, insurance, and property taxes on the home.

1. This designation shall remain in effect for all future periods until amended or revoked by the Council.

1. The minister shall keep records of housing expenses, and is responsible for including in income any portion of the allowance that exceeds the least of the amounts the law permits to be excluded.

1. The Church shall report the allowance to the minister separately from taxable wages and shall not include it in Box 1 of Form W-2.

Adopted on [DATE], by a vote of [n]–0, [Name] and [Name] voting, [Name] abstaining as an interested person. Comparability data considered: [describe].

Minister's annual estimate (attach)

Fair rental value of the home, furnished, plus utilities: $________ per year.