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Parsonage Exclusion Allowance

Parsonage Exclusion Allowance. Least of three values:. Actual cost. Fair rental value of furnished home plus utilities. Voted limit -- $46,000 . Parsonage Allow Expenses. Mortgage/Rent; Home or Renter ’ s Insurance Property Tax, Closing costs on purchase (not refinancing closing costs)

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Parsonage Exclusion Allowance

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  1. Parsonage Exclusion Allowance • Least of three values: • Actual cost • Fair rental value of furnished home plus utilities • Voted limit -- $46,000

  2. Parsonage Allow Expenses • Mortgage/Rent; Home or Renter’s Insurance • Property Tax, Closing costs on purchase (not refinancing closing costs) • Furniture, appliances, utilities, base amount for one telephone line, internet service, basic cable • Furnishings (rugs, curtains, cookware, dishes, tableware, appliances, linens, pictures, radios, CD/DVD players, computers) • Landscaping/lawn care, sprinkler, lawn mover, lawn & garden tools fertilizer, fuel for mower

  3. Parsonage Allow Expenses • Cleaning or janitorial services; professional carpet or drape cleaning, cleaning supplies such as brooms, mops, detergents and waxes • Repairs/maintenance/home improvements • Do NOT Report: • Detergents for dishwashing, laundry • Personal hygiene expenses • Maid service

  4. Double Dip! Mortgage Interest & Real Estate Taxes • Are reported as Parsonage Expenses • And as itemized deductions on Sch A • A rare but legal double deduction of expenses!

  5. Tax Return Full $46,000 will be reflected on your W-2, unless you elect a lower amount at the beginning of the year. You will compare actual to the W-2 amount and make adjustment on 1040 tax form.

  6. Duplicate Housing 2 residences due to a move. Same rules apply, lesser of actual or fair rental value. This applies to both homes. $46,000 is cap for both homes.

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