Pastor Tax Planning for 2026

The minister’s housing allowance can provide incredible tax advantages for most qualified ministers. It isn’t too late to make sure that you have the right dollar amount “designated” by your leadership board for housing allowance in 2026. If you have multiple pastoral staff, take a moment in staff meeting to remind your team of the importance of proper planning to maximize your tax benefits.

MB Foundation provides two very important resources for pastors and churches, updated annually. The Minister’s Tax Guide has excellent information on housing allowance, beginning on page 63, along with helpful worksheets for your use on page 77. I highly recommend using these worksheets for your own documentation.

Don’t forget, the actual housing allowance you should use for federal tax purposes is the LOWEST of actual expenses, designated housing allowance and the fair rental value of the home with some adjustments. Personally, I use the form on page 78 every year to complete my tax return. I encourage you to do so as well!

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