A Closer Look at the Housing Allowance

Church Law & Tax | 3/13/2018 | Staff
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For qualifying ministers, the housing allowance is an invaluable tax benefit—in fact, according to attorney and Church Law & Tax senior editor Richard Hammar, it’s “the most important tax benefit available to ministers.”

In October 2017, however, a federal judge in Wisconsin ruled the ministerial housing allowance was unconstitutional, reasoning that it showed a preference for religion. The parsonage allowance, a separate benefit, was not affected by the decision.

Court - Decision - Housing - Allowance - US

The federal court’s decision regarding the housing allowance is currently being appealed to the US Court of Appeals for the Seventh Circuit. Were the Seventh Circuit to affirm the lower court’s decision, clergy in Illinois, Indiana, and Wisconsin would be immediately affected. There are scenarios in which such a decision also could get applied nationally.

Given those possibilities, it’s helpful to understand just what the housing allowance as a benefit means to many congregations and clergy around the country. Here’s a closer look, based on recent surveys conducted by Christianity Today’s Church Law & Tax Team.

Majority - Pastors - United - States - Housing

The majority of senior and solo pastors in the United States receive a housing allowance. Among those surveyed, the following receive one:

81 percent of full-time senior pastors;

Percent - Pastors

57 percent of part-time senior pastors;

67 percent of solo full-time senior pastors;

Percent - Solo - Pastors

59 percent of part-time solo pastors.

Congregations with fewer than 200 people in weekly attendance represent the vast majority of the country’s churches. Half of the senior pastors surveyed lead churches with a budget of less than $625,000. Nearly all full-time solo pastors serve in churches with an annual income of $500,000 or less. More than 60 percent of solo pastors lead a church with an average weekly attendance of 100 or less.


Among those categories:

The median base salary for full-time senior pastors breaks down as follows by church income:

Housing - Allowance - Pastors - Church

Meanwhile, the median housing allowance for full-time senior pastors breaks down as follows by church...
(Excerpt) Read more at: Church Law & Tax
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