User Support Forum

We pay our pastor an "income" item which fits under the PC "Housing Allowance" section in Payroll and works just fine.
However, he is also eligible for a tax deduction called "Housing Exclusion Allowance" (section 107 of the IRS code), which does not effect his net pay, but is an annual income deduction which is supposed to go into box 14 on the W-2 as "other".

Can anyone tell me how to enter this into the payroll system so the 914's and W-2's come out properly? So far I've had to manually change the figures when I generate the PC 914's....

SunsetTreas wrote:We pay our pastor an "income" item which fits under the PC "Housing Allowance" section in Payroll and works just fine.
However, he is also eligible for a tax deduction called "Housing Exclusion Allowance" (section 107 of the IRS code), which does not effect his net pay, but is an annual income deduction which is supposed to go into box 14 on the W-2 as "other".

Can anyone tell me how to enter this into the payroll system so the 914's and W-2's come out properly? So far I've had to manually change the figures when I generate the PC 914's....

Um ... I'm not sure what he's doing, but Section 107 is the section that covers Housing Allowance for Ministers. Housing allowance is not taxed for income, but taxed for Social Security.

If you have Payroll setup proprely, the Housing Allowance should appear in the correct location on the W-2.

Unless I'm not understanding the issue, in which case, please explain what additional deductions are being expected.