As I've written in other forums before, many church leaders today do not know or understand what a minister housing allowance is. If they’ve heard of it they don’t know how or why to designate one. This is definitely one area where the definition doesn't matters as much as the implementation.

Properly designating a minister housing allowance is not necessarily an easy task. Church tax law requires that a designation meet specific rules and be made only for specific purposes. In addition, the designation of a minister's parsonage or housing allowance may encompass property that is owned by a church, or that is owned or rented by a minister.

Many churches fail to properly and timely designate a minister housing allowance. As a result, their clergy are saddled with huge unexpected tax liabilities that the church must often assist with. At times, entire housing allowances have been disallowed for failure to abide by simple, technical procedures.

Building On Faith was written partly to help a new church avoid those problems. Specific guidance is given in Chapter 9, “Designate A Parsonage Or Housing Allowance.” In addition to a specific description of the applicable rules, sample board resolutions intended to properly designate a minister housing allowance are included for your convenience. The entire process is set up so that churches need only use the resolution templates and follow the clear guidance.

As churches powerfully advance their missions and focus on church planting and starting a new ministry, this aspect of a church start up should never become a distraction. Ministers duties are so varied and saddled with such tremendous responsibility, that the last thing they need is to have to think about whether the church has properly designated their minister housing allowance.

Help your ministers focus on their strengths--spreading the gospel and shepherding the flock--and know that all your church's legal and business matters need not be difficult and create unnecessary diversion.