PARSONAGE ALLOWANCE

Index of Page:

1. Parsonage Allowance Form
2. 26 USC 107 & Regulation 1.107
3. Links

Ministerís Parsonage
Allowance Resolution

 ę

LifeSpirit Congregational Church
Local Congregation:

__________________________________________________

Resolved by the Local Congregation:

 Whereas it is right and proper for the Local Congregation to provide for the Ministerís parsonage allowance,
as remuneration for the ministerial duties thereof, as provided in 26 U.S.C. 107, and

Whereas the communicants and associates of the Local Congregation are urged to
tithe freely for the maintenance of the ministers of the church,

  It is therefore Resolved that the Local Congregation is hereby authorized to expend or cause to be expended, to for or on behalf of Rev._________________________, as Minister of the Local Congregation, a designated Parsonage Allowance not to exceed, on an annual basis, the fair market rental value of the Ministerís dwelling and the utility expenses therefore, as well as any other parsonage expenses as permitted by law, regulation or resolution.  Regulation 1.107.1 provides that expenses which are directly related to providing a home (including maintenance, repairs and enhancements) shall be included in the Allowance, except expenses for food and servants.  In the case of a home owned by the church or minister, the expenses may also include real estate taxes and mortgage payments.  The Parsonage Allowance does not include the Ministerís Professional Expenses (which are paid or reimbursed separately from the Allowance) nor any personal Stipend, Reimbursement, Gratuity or Gift received by the Minister.  The Minister may request, from time to time, Parsonage Allowance funds as they may be required for the maintenance and providing of the parsonage, and funds, when provided, shall be specifically designated, in writing on the check or money order, as part of the Parsonage Allowance.  All rights reserved.

     Approved this       day of                          , 200__

-----------------------------
Authorized Signatory

INDEX

This form is for use by local congregations of the Church.

Title 26, Section 107. Rental value of parsonages
      In the case of a minister of the gospel, gross income does not
    include -
        (1) the rental value of a home furnished to him as part of his
      compensation; or
        (2) the rental allowance paid to him as part of his
      compensation, to the extent used by him to rent or provide a
      home.
 
Code of Federal Regulations- Title 26, Volume 2
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.107-1][Page 449-450]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1--INCOME TAXES--Table of Contents
 
Sec. 1.107-1  Rental value of parsonages.

    (a) In the case of a minister of the gospel, gross income does not 
include (1) the rental value of a home, including utilities, furnished 
to him as a part of his compensation, or (2) the rental allowance paid 
to him as part of his compensation to the extent such allowance is used 
by him to rent or otherwise provide a home. In order to qualify for the 
exclusion, the home or rental allowance must be provided as remuneration 
for services which are ordinarily the duties of a minister of the 
gospel. In general, the rules provided in Sec. 1.1402(c)-5 will be 
applicable to such determination. Examples of specific services the 
performance of which will be considered duties of a minister for 
purposes of section 107 include the performance of sacerdotal functions, 
the conduct of religious worship, the administration and maintenance of 
religious organizations and their integral agencies, and the performance 
of teaching and administrative duties at theological seminaries. Also, 
the service performed by a qualified minister as an employee of the 
United States (other than as a chaplain in the Armed Forces, whose 
service is considered to be that of a commissioned officer in his 
capacity as such, and not as a minister in the exercise of his 
ministry), or a State, Territory, or possession of the United States, or 
a political subdivision of any of the foregoing, or the District of 
Columbia, is in the exercise of

[[Page 450]]

his ministry provided the service performed includes such services as 
are ordinarily the duties of a minister.
    (b) For purposes of section 107, the term ``home'' means a dwelling 
place (including furnishings) and the appurtenances thereto, such as a 
garage. The term ``rental allowance'' means an amount paid to a minister 
to rent or otherwise provide a home if such amount is designated as 
rental allowance pursuant to official action taken prior to January 1, 
1958, by the employing church or other qualified organization, or if 
such amount is designated as rental allowance pursuant to official 
action taken in advance of such payment by the employing church or other 
qualified organization when paid after December 31, 1957. The 
designation of an amount as rental allowance may be evidenced in an 
employment contract, in minutes of or in a resolution by a church or 
other qualified organization or in its budget, or in any other 
appropriate instrument evidencing such official action. The designation 
referred to in this paragraph is a sufficient designation if it permits 
a payment or a part thereof to be identified as a payment of rental 
allowance as distinguished from salary or other remuneration.
    (c) A rental allowance must be included in the minister's gross 
income in the taxable year in which it is received, to the extent that 
such allowance is not used by him during such taxable year to rent or 
otherwise provide a home. Circumstances under which a rental allowance 
will be deemed to have been used to rent or provide a home will include 
cases in which the allowance is expended (1) for rent of a home, (2) for 
purchase of a home, and (3) for expenses directly related to providing a 
home. Expenses for food and servants are not considered for this purpose 
to be directly related to providing a home. Where the minister rents, 
purchases, or owns a farm or other business property in addition to a 
home, the portion of the rental allowance expended in connection with 
the farm or business property shall not be excluded from his gross 
income.

[T.D. 6500, 25 FR 11402, Nov. 26, 1960, as amended by T.D. 6691, 28 FR 
12817, Dec. 3, 1963]


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