From one pastor to another

Dear fellow pastor,

I have pastored for more than forty years, the last twenty-three of them at Champion Church in Yuma, Arizona. For most of those years I thought I was handling my housing allowance fine.

Every spring there was a shoebox of receipts. Every year there was a number for the board, and it was mostly last year’s number. And there was a tax preparer who did his best with what I handed him. None of it was careless. It was simply all anyone had ever shown me.

What I didn’t know was that the housing allowance is governed by three numbers, not one: the amount the board designates, what you actually spend providing your home, and the Fair Rental Value of the home itself. Your exclusion is the lowest of the three. For a lot of us, the one that decides it is the one we never calculated. (The three numbers, explained.)

Nobody told me, either, that a minister pays his own Social Security tax, on the housing allowance too, with no one withholding it. I opted out of Social Security early in my ministry, so that one never caught me. It has caught a lot of pastors I care about, and it catches more every April. (The opt-out is narrow and permanent, and it is not for most of us; the Form 4361 guide explains who it is for.)

Over the years I watched younger pastors guess at their housing allowance because nobody had explained the three numbers to them. They were doing exactly what I had done.

So I built ClergyTrak. There is an iPhone app for catching a receipt the day you pay it, and a Command Center on the web for catching up, looking over the whole year, and printing what someone asks you for. It gives you your three numbers, estimates the Fair Rental Value of your home from real local rentals, and produces the board report and the year-end packet your CPA asks for.

The app and the Command Center are free to use, and the guides are free to read, no account needed. ClergyTrak Pro is $129 a year — that works out to $10.75 a month, billed once a year. If your church has a written accountable plan, it can likely reimburse you for it, and ClergyTrak prints the voucher your treasurer needs at no charge.

What you enter is yours. Nobody sees it through ClergyTrak unless you print it and hand it to them — not your board, not your district. If a denomination ever pays for your seat, it receives an invoice and a count of seats, never your numbers.

One more thing, because of the time of year it always seems to be. Before the new year begins, your board sets next year’s housing allowance, and a designation adopted late counts only from the day of the vote. Give them a real number this time, not last year’s. This guide shows how to arrive at it, and the free board resolution is one page they can adopt the night they meet.

You’re not behind. Just start. It takes about fifteen minutes to know where you stand.