No, you can change your designation at any time throughout the year, and you can amend it as needed.
IRS details the housing allowance in section 107 of the Internal Revenue Code. While the IRS does not specify when you can designate, they do specify that designating must be done in advance. You can only designate an allowance moving forward. You can never retroactively designate or change an allowance. This is why it is often good to over-estimate your allowance, just in case something happens during the year that merits more housing expense.
IRS auditing guidelines also specify that the designation “may appear in the minister’s employment contract, the church minutes, the church budget, or any other document indicating official action. Treas. Reg. § 1.107-1(b)”. A verbal designation is generally considered insufficient or can be difficult to prove in an audit. Keeping a written record is always safer.
While the IRS may not restrict when you change your designation, individual churches and religious organizations often have their own internal rules and regulations. If your church has rules that state you can only designate at the beginning of the year.
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