artp Posted March 26, 2017 Report Share Posted March 26, 2017 Pastor makes several overseas missionary trips each year. He is a dual status taxpayer in that he receives a W-2 for his "wages" but pays SE tax on his earnings. Pastor's wages are reported in box 1 with no other entries on W-2 except for parsonage allowance in box 14. The church does not withhold FIT or pay in Medicare or SS. For SE tax he is allowed to deduct his 2106 expenses after applying the tax free % from clergy 1 worksheet.The church synod pays for the air fare and room accommodations only. He pays for everything else. My question concerns the use of State Dept M&IE allowance tables to substantiate these deductions much like the CONUS tables for travel in US. For example in he travels to India and the State Dept tables allow $90/day can he claim that without a paid receipt, just a daily log entry with the business purpose of missionary teaching/preaching? If so, then could he use those expenses (after applying the 50% limit) in computing his SE tax? Is my understanding correct? Art Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted March 27, 2017 Report Share Posted March 27, 2017 Check Pub. 463, I think it covers this pretty well. Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.