Housing Allowance in Court
A brief reminder the US Court of Appeals for the Seventh Circuit will listen to oral arguments from various Christian groups in appeal of the circuit’s original ruling of housing as unconstitutional. For now we ask you proceed as usual. We’ll keep you updated on any changes that come to our attention.
Receipts/Bills
Keep all of your bills and receipts in a tax folder…call it 2018 Housing Expenses. Your tax preparer does not need to see these receipts (that’s what the spreadsheet is for). Hold onto them in case the IRS asks for further documentation.
Housing Allowance Spreadsheet
We suggest you track all of your housing expenses in four categories. You might want to download the Excel spreadsheet below, if you’re comfortable doing so. The categories are Mortgage/Rent, Housing Items, Utilities, Phone/Internet.
Download Excel spreadsheet
Enter checks, cash, and credit card transactions. Credit cards are considered same as cash for tax purposes, no matter when you actually pay off the card. So a credit card swipe for furniture bought on December 31st counts in the current tax year, even though the bill won’t be paid until January.
Housing %
As a reminder, you should be claiming at least 80% housing allowance with the school/church that hired you. Most schools/churches have a default of 50%
(NOTE: Parsonage clients ignore housing % as this does not apply to you).
Unreimbursed Expenses
This item was removed under current tax law. Will be applicable again in the year 2025.
Summary
- Change housing allowance to at least 80% (parsonage ignore)
- Track housing expenses
- Save housing receipts and bills in a tax folder (save for 7 years)
- Use spreadsheet to provide to your tax preparer (or similar document if you prefer your own method)
- Ask questions anytime