Question

TICKET TO HEAVEN

Your client a pastor has not filed tax returns for the following years. He is married. There combined income is follows:

                        Wife Salary     Pastor’ Salary              Parsonage Allowance

2013                18000              23500                          9500

2014                18500              22,000                         8,500

2015                20,000             24,000                         8700

2016                25,000             26,000                         9,500

2017                26,000             30,000                         12,000

2018                32,000             35,000                         18,000

2019                35,000             38,500                         24,000

Pastor built his own home in 2015 and there was no mortgage on the house. The wife works as a teacher in HISD and the income tax withheld from her was 15% of salary. The income tax withheld from Pastor’s salary was 20 % of his salary. Help them.

Required: File these tax returns. Read IRS publication on Pastor/Clergy for 2019 only. Pay close attention to Parsonage Allowance. For 2019, prepare tax return two ways (1) Pastor is in Social Security System (2) Pastor is not in Social Security System.

Answer 1