FORM for DESIGNATING HOUSING EXCLUSION* or HOUSING ALLOWANCE**

United Methodist Church
Charge Conference/Church Council Date:
Rev./Pastor:

*DESIGNATION OF HOUSING EXCLUSION:

(When a church provides a parsonage.)

Whereas Section 107 of the Internal Revenue Service Code (1986) permits an ordained minister of the gospel to exclude from gross income “the rental value of a home furnished as part of compensation or the rental allowance paid as part of compensation, to the extent used to rent or provide a home”, and

Whereas Rev./Pastor / is compensated by the
United Methodist Church exclusively for services as a minister

of the gospel; and;

Whereas the / U.M. Church owns the parsonage,
Therefore it is hereby resolved that of the total compensation paid to:
Rev./Pastor / for calendar year / , / $ / is here by
designated as the housing exclusion pursuant to Section 107 of the Internal Revenue Service Code
The minister shall also have the rent-free use of the home located at:
for the year
and for every year thereafter as long as he/she is minister of the
United Methodist Church.

HOUSING EXCLUSION

(When the church provides a parsonage)

The IRS has specifically excluded the following from the costs “to provide a home”

a.  the cost of food

b.  the cost for domestic help (this probably excludes clothing as well)

“To provide a home”, i.e. dwelling place and related structures (e.g. garage, etc.)

-  Insurance: tenant’s/renter’s insurance – fire, theft, accident liability

-  Repairs & maintenance not paid by the church: to the home, appliances, lawn equipment, TV; light bulbs, cleaning supplies like brooms, cleaners

-  Furniture and appliances (TV, computers, etc.)

-  Decorating accessories not paid by the church: linens, carpets, drapes, pictures & paintings, lamps, etc.

-  Utilities not paid by the church: garbage removal, cable TV, telephone

-  Miscellaneous not paid by the church: lawn care, tools, plants, snow removal

HOUSING EXCLUSION WORKSHEET

Minister’s Estimate of Expenses

ITEM: AMOUNT:

Insurance (tenants’/renters’ on contents) $ ______

Repairs & maintenance (not paid by church) $ ______

Furnishings $ ______

Decorating accessories $ ______

Utilities (not provided by church) $ ______

Other housing expenses $ ______

Total $ ______

**DESIGNATION OF HOUSING ALLOWANCE

(When the Church Does Not own a Parsonage)

Whereas Section 107 of the Internal Revenue Service Code (1986) permits an ordained minister of the gospel to exclude from gross income “the rental value of a home furnished as part of compensation or the rental allowance paid as part of compensation, to the extent used to rent or provide a home”; and

Whereas Rev./Pastor / is compensated by the
United Methodist Church exclusively for services as a minister of

the gospel and;

Whereas the / United Methodist Church does not provide Rev./Pastor
with a parsonage;

Therefore it is hereby resolved, that of the total compensation paid to Rev./Pastor

for calendar year / , / $

is hereby designated as the housing allowance pursuant to Section 107 of the Internal Revenue Service Code; and it is further resolved, that the designation of $ as a housing allowance shall apply to calendar year and all future years unless otherwise provided for.

HOUSING ALLOWANCE

(When the church does not own a parsonage.)

The IRS has specifically excluded the following from the costs “to provide a home”

a.  the cost of food

b.  the cost for domestic help (this probably excludes clothing as well).

“To provide a home”, i.e. dwelling place and related structures (e.g. garage etc.)

-  Rent of home/apartment

-  Down payment & Mortgage installment payments on home + related expenses such as

-  commissions, attorney’s fees, escrow fees, etc.

-  Mortgage interest, real estate taxes, special assessments: e.g. for street, sewers, etc.

-  Insurance: tenant’s or homeowners – fire, theft, accident liability

-  Repairs & Maintenance: to the home, appliances, lawn equipment, TV, light bulbs,

-  cleaning supplies like brooms, cleaners

-  Furniture and appliances (TV, computers, etc.)

-  Decorating Accessories: linens, carpets, drapes, pictures & paintings, lamps, etc.

-  Utilities: garbage removal, sewage, cable TV, gas water, electricity, telephone

-  Miscellaneous: lawn care, tools, plants, snow removal

HOUSING ALLOWANCE WORKSHEET

Minister’s Estimate of Expenses

ITEM: AMOUNT:

Rent of home/apartment $ ______

Purchase expenses and Mortgage payments $ ______

Mortgage interest, taxes, etc. $ ______

Insurance: tenants’/renters’ or homeowners $ ______

Repairs & maintenance $ ______

Furnishings $ ______

Decorating accessories $ ______

Utilities $ ______

Other housing expenses $ ______

Total $ ______

1

Revised July 2013