Our church, a small Baptist Church in NC, has hired an ordained minister for the position of part-time children's minister with an annual compensation of $ 6000. I feel confident that at least a portion of this compensation can be claimed as housing allowance and therefore exempt from income tax, since the minister is ordained and performing ministry in the Church.
My question, can the entire amount be claimed as a housing allowance (as long as the church designates it as such). The minister's housing costs will certainly exceed the compensation amount. I read something that said, 'there is no limit to the housing allowance as long as the compensation is reasonable'. I am not sure what that means.
Thanks for your help, Chris