THE PASTOR'S HOUSE
The Invaluable Housing AllowanceTM
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Pastoral Gross-to-Net Compensation Calculation
Pastor's gross-to-net compensation distribution
This calculation helps you to maximize your housing allowance and reduce your income subject to taxes.
The Pastoral Compensation Distribution is a calculation that considers a pastor's gross-to-net distribution of their church compensation. It may include the housing allowance, salary, deductible taxes (federal, state, local) taxes; any other voluntary deductions such as 403(b), etc. This calculation helps you to maximize your housing allowance and reduce your income subject to taxes.
A pastor may want to have this calculation prepared by a third party familiar with the rules and regulations for clergy compensation planning. Otherwise, they could unknowingly, forego benefits that would otherwise be available to them.
This worksheet is the most important calculation in your church compensation planning. This is the calculation that separates your taxable income from your tax-exempt income. Prepare it thoughtfully and carefully.
The Pastor's House website includes a basic calculation to assist in this process. The main objective of the website calculation is to maximize the ratio between housing and salary. The church payroll service or other service providers could then calculate the applicable taxes on the correct taxable income.
