Chapter 6: Parsonages

Clergy housing allowances remain one of the most significant tax benefits for pastors. Whether living in a parsonage, renting, or owning a home, ministers can exclude designated housing benefits from federal income taxes — though not from Social Security taxes. This guide explains how parsonages, parsonage allowances, and housing allowances work; how to designate them properly; and what recent court rulings mean for their continued constitutionality.