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How do I report my parsonage allowance?

If you receive a housing or parsonage allowance you can exclude from gross income the smaller of the amount used to provide or rent a home, the fair market rental value of the home, the amount designated as a rental or housing allowance or an amount that represents reasonable pay for services. If your congregation furnishes housing you may exclude its value from income. You must pay self-employment tax on the allowance or value of the housing.

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