A Guide from Scott Larsen, CPA

The Pastor's Tax Savings Checklist

Pastors are paying too much in taxes. You're simply payin. A little planning each year can make a tremendous difference. Use this checklist before filing.

We save pastors thousands of dollars on their taxes.

Review Your Housing Allowance

Your housing allowance should never be "set it and forget it." Review it every year before the new tax year begins.

"Bigger isn't always better. A housing allowance isn't automatically your biggest tax advantage."

Review Your W-2 Before Tax Season

One of the biggest mistakes pastors make is never looking at what's actually reported on their W-2. Ask yourself:

"Small changes here can make a significant difference over time."

Maximize Your 403(b)

For many pastors, a 403(b) is one of the most powerful tax-saving tools available. Review annually:

"This isn't just about retirement. It's about reducing taxes today while preparing for tomorrow."

Track Ministry Mileage

Most pastors dramatically underestimate their ministry mileage. Instead of guessing at tax time:

"Every mile matters."

Keep Track of Ministry Expenses

Don't assume an expense doesn't help you simply because your church didn't reimburse it. Throughout the year, keep records of expenses such as:

"Good records today create better tax opportunities tomorrow."

Understand Your Self-Employment Tax

Many pastors prepare for income taxes but are surprised by self-employment taxes. Review annually:

"Avoiding surprises starts with planning — not guessing."

Know Whether Your CPA Truly Understands Minister Taxes

Not every CPA understands pastor tax law. Ask your tax preparer:

"General tax knowledge isn't the same as minister tax expertise."

Review Your Compensation Package

Don't just ask "How much am I paid?" Also ask "How is my compensation structured?" A well-structured compensation package may include:

"How you're paid can be just as important as how much you're paid."

Ask About an Accountable Reimbursement Plan

Many churches either don't have one — or aren't using one correctly. Ask:

"This one decision alone could reduce unnecessary taxes."

Don't Forget Required Ministry Giving

If your denomination or church requires pastoral giving, make sure your tax preparer asks about it. Review:

"These items may affect your tax calculations differently than most pastors realize."

Stay Organized Throughout the Year

Tax season should never be a scramble. Create three simple folders:

"A little organization can save hours of frustration."

Get a Pastor-Specific Tax Review

Most pastors never receive a second opinion on their taxes. That could be costing them money every single year. A pastor-specific review should evaluate:

"Good tax planning isn't about this year's return. It's about every year that follows."

Warning Signs You May Be Overpaying

Take a quick inventory. If you answer Yes to any of these, it's probably worth having your taxes reviewed.

Your score: 0 / 8

Great — you're on top of it. A yearly review still keeps things sharp.

Final Thoughts

Being a faithful steward doesn't mean paying more taxes than necessary. It also doesn't mean taking unnecessary risks. It means understanding the unique tax rules written specifically for ministers — and using them wisely.

Ready for a Second Opinion?

Your Complimentary PASTOR TAX TRIAGE

Scott Larsen has spent decades helping pastors understand one of the most misunderstood areas of the tax code. What we can discuss:

Review of your current tax return
Housing allowance evaluation
Compensation package
Self-employment tax analysis
Retirement planning
Ministry expense strategy
Personalized recommendations

Ready to get started? Call the office and ask for Crystal — she'll take great care of you.

(262) 955-1669

Keep Learning

Watch more pastor tax tips on our YouTube channel, @TaxScott.

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