Q&A: Can a Retired Minister Receive a Housing Allowance?

Editor’s Note: The question of whether mutual funds and other private investment services can administer a 403(b) plan for ministers and designate housing allowances is addressed in the Church & Clergy Tax Guide. For more guidance with housing allowances and retirement planning, check out chapters 6 and 10 in particular.

Can a retired minister receive a housing allowance?

Treas. Reg. 1.107-1(b) says this: “The term rental allowance means an amount paid to a minister to rent or provide a home, if such amount is designated as a rental or a housing allowance pursuant to official action taken in advance of such payment by the employing church or other qualified organization.”

(Note: The tax code uses the term “rental allowance.” I use the term “housing allowance” to apply to both rental and ownership. But “rental allowance,” when used by ...