For clergy who are living permanently in a nursing home, they can use some (but not all) of their nursing home expenses for the housing allowance. For example, the rental cost of their room and the utilities are eligible for the housing allowance. The food and medical care are not eligible for the housing allowance. Not every nursing home provides the breakdown of the bill upfront, so you may need to ask the administrator or accounting department of the facility to provide an itemized list of the monthly expenses. Your tax preparer will use this to determine what is deductible.
Clergy who live only temporarily in a nursing home continue to use expenses from their principal residence for the housing allowance, not the nursing home. Also, if the housing allowance is applied against permanent nursing home costs, it cannot apply for a separate home where the spouse lives.
Long term care insurance premiums and medical care costs can be claimed on Schedule A (assuming that they exceed the threshold set by tax law).
Regardless of what stage of your life you are entering, Clergy Financial Resources provides the customized tax resources you need. For more information on setting up a pro advisor consultation, visit our website at https://www.clergyfinancial.com/resources/proadvisor/
Clergy Financial Resources serves as a resource for clients to help analyze the complexity of clergy tax law, church payroll & HR issues. Our professionals are committed to helping clients stay informed about tax news, developments and trends in various specialty areas.
This article is intended to provide readers with guidance in tax matters. The article does not constitute, and should not be treated as professional advice regarding the use of any particular tax technique. Every effort has been made to assure the accuracy of the information. Clergy Financial Resources and the author do not assume responsibility for any individual’s reliance upon the information provided in the article. Readers should independently verify all information before applying it to a particular fact situation, and should independently determine the impact of any particular tax planning technique. If you are seeking legal advice, you are encouraged to consult an attorney.
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