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Parsonage or allowance: which wins?

Compare the church's cost and the pastor's tax bill side by side — the cheapest option for the church isn't always the best deal for the pastor.

Option A: parsonage

01 / CHURCH HOME
$
$

Option B: allowance

02 / CASH
$
$
$
%

A parsonage's full rental value is excluded from income tax. A cash allowance is capped at the lowest of three numbers.

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Two ways to house a pastor.

Enter what each option costs the church and what it saves the pastor.

Last reviewed: October 2026.

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Honed Money provides calculators and educational information for general purposes only. It is not financial, tax, legal, investment, or insurance advice. Estimates are based on the information you enter and the assumptions shown. Actual results will vary. For taxes, retirement, and government benefits, verify with IRS.gov, SSA.gov, or VA.gov. We don’t sell financial products and aren’t paid for calculator results. Use at your own risk.