How is the housing allowance paid to the minister?
It is immaterial whether the payment of a properly designated cash housing allowance is a separate payment or is part of a payment that also includes other compensation. A cash housing allowance usually is included with the ministers salary check. Return to questions. 14. Second mortgage payments may not qualify as housing expenses. Many ministers have claimed excludable housing expenses based on home equity line of credit payments or payments on a conventional loan secured y a mortgage on an otherwise debt-free home. This practice is not brought into question by an IRS ruling. This ruling appears to relate only to mortgage payments (principal and interest) on the two specified types of loans. If loan proceeds are used for home furnishings, home repairs or other qualified housing expenses, the expenses may be excluded under a properly designated housing allowance. The tax year in which the housing expenses are excludable is based on when the housing expenses are made not when the loan
