Sample housing allowance designation resolution (free template)

Sample housing allowance designation resolution

An editable starting point a church board can adapt to designate a minister's housing allowance in advance. Fill in the highlighted blanks, have your attorney or CPA review it, and adopt it before the payments it covers.

This is a sample for education only, not legal or tax advice. It does not tell you what amount to designate. Follow your church's governing documents, and have your attorney or CPA review the final wording. Full disclaimer

[CHURCH NAME]

Resolution Designating a Minister's Housing Allowance for calendar year [YEAR]

WHEREAS, [Church Name], a [type of organization] located in [City, State] (the "Church"), employs [Minister's Name] (the "Minister") as [title]; and

WHEREAS, the Minister is [ordained / licensed / commissioned] as a minister of the gospel and performs ministerial services for the Church; and

WHEREAS, section 107 of the Internal Revenue Code allows a minister of the gospel to exclude from gross income for federal income tax purposes a housing allowance that has been officially designated by the employing church in advance of payment, subject to the limits in that section; and

WHEREAS, the Church wishes to designate a portion of the Minister's compensation as a housing allowance before any such payment is made;

NOW, THEREFORE, BE IT RESOLVED that the [Board of ________ / Congregation] of the Church designates $[AMOUNT] of the compensation paid to the Minister for calendar year [YEAR] as a housing allowance;

BE IT FURTHER RESOLVED that this is a definite dollar amount and applies to compensation paid on and after [effective date] through [end date], and that it remains in effect for later periods only if it is renewed or replaced by a further official action taken before the payments it would cover;

BE IT FURTHER RESOLVED that the designated amount will be paid to the Minister as part of the Minister's regular compensation, [in equal installments / with each payroll], and that the Church's treasurer will keep a copy of this resolution with the Church's official records; and

BE IT FURTHER RESOLVED that the Minister is responsible for determining how much of the designated allowance may be excluded from income for federal tax purposes, and that the Church makes no representation about the Minister's tax treatment.

ADOPTED at a [regular / special] meeting of the [Board / Congregation] on [date], at which a quorum was present, by a vote of [__] in favor and [__] against.

[Name], [Chair / Moderator] · Date: ________

[Name], Secretary · Date: ________

Secretary's certification. I certify that the foregoing is a true copy of a resolution duly adopted by the [Board / Congregation] of [Church Name] on the date stated above and recorded in its minutes.

[Name], Secretary · Date: ________

How to use it

Fill in the highlighted blanks. Use a definite dollar amount for the year. Talk to your CPA about the amount; this template does not suggest one.
Adopt it before the payments it covers. The IRS says the church must officially designate the payment before it makes the payment, and it cannot determine the amount at a later date.
Use an official action. Publication 517 says a designation can be shown in an employment contract, church minutes, a budget, or another official action taken in advance of payment. Informal discussions do not count.
Follow your governing documents for who must approve it (a board, the congregation, or both).
Record it and share copies. The secretary records the action in the minutes; the pastor and the treasurer each keep a copy.
Have it reviewed by your church's attorney or CPA before you adopt it.

Read the full step-by-step guide: How to designate your housing allowance for next year. Source: IRS Publication 517 (opens in a new tab).

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