I am an unpaid pastor of a church in RI, but I do live in the church parsonage, rent free and bill free. Must I claim this on my taxes, and also am I allowed certain deductions, even though I am unpaid?
You are not subject to income taxes on the use of the parsonage; however, the fair rental value of the parsonage plus utilities is added when figuring your self-employment tax.
You are responsible for determining the fair rental value of the parsonage. A simple way would be to determine what comparable houses rent for in the area. A realtor can sometimes provide this information.
You would report this amount on a Schedule SE when preparing your personal tax return.
Since there is no income and no income tax due...I do not believe there are any deductions you could take.