April 13, 2017

Batteries as Housing Allowance Expense

Question:

Do batteries qualify as a housing allowance expense?

Answer:

The expenditure for batteries, if meeting the following general guidelines for use in connection with the pastor's personal residence, may meet the requirements. Although there are not likely court cases or Revenue Rulings citing the exact examples offered here.

In a June 2016 post, we shared the following:

"A minister’s housing allowance benefit is non-taxable income to the extent that the allowance is used for housing expenses. The three-part test includes consideration of the fair rental value of the home, plus actual costs of utilities (see this blog post regarding the three-part test). In addition, the expenses must be incurredrelative to the minister’s principal residence. According to Federal Tax Regulations, Regulation, §1.107-1, Internal Revenue Service, Rental Value of Parsonages, only food and servants are specifically excluded."

If, for example, the batteries are for a smoke alarm in the house, then they would be housing expenses. But if the batteries are for a child’s toy, then they would not be considered housing expenses.

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