Question & Answer: Pastor Martin received $40,000 in ministerial earnings; $28,000 salary for ministerial services; $2,000 for performing wedd…..

Pastor Martin received $40,000 in ministerial earnings; $28,000 salary for ministerial services; $2,000 for performing weddings; and $10,000 tax-free parsonage allowance. Pastor Martin incurred $5,000 of unreimbursed expenses connected with his ministerial earnings – $4,500 related to his ministerial salary and $500 related to the weddings performed as self-employed.

How much of the expense related to his self-employed earnings is deductible when figuring net income for income tax after allocation to the tax-free parsonage allowance?

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$125

$375

$500

$5,000

Expert Answer

 

$375 is deductible when figuring net income for income tax after allocation to the tax-free parsonage allowance
Option 2 is correct

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