PARSONAGE UTILITIES

by R L Thames
(Tennessee)

When I became pastor I commuted back and forth to the church from my home (110 miles 1 way). To be closer to the church we moved into the parsonage and put our house on the market. The church paid the utilities at the parsonage like they always had and we paid our utilites at our home until the home sold. Do I owe taxes on the full cost of the utilites that the church paid even while I was having to pay to keep the lights on at my own home?

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IRS Pub 517
by: Vickey

Ummm...you are not going to like my answer:-(

You will not be subject to income taxes on the use of the parsonage.

However, the fair rental value of the parsonage (plus utilities if paid by church) will need to be added in when figuring your self-employment tax.

See page 7 of the IRS's Publication 517: Social Security and Other Information for Members of the Clergy and Religious Workers.
payment from church
by: Anonymous

Usually the cost of your utilities would be included in the amount of your housing allowance. If the church did not include the amount in your houseing allowance but paid them directly to the 3rd party I believe you would not have to include them except for the SS taxes (same as housing allowance) If they paid directly to you it is income and taxable. I would call the IRS on this one. They are very helpful.

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