I live in a church-owned parsonage. Does any of this apply to me?

Yes. Parsonage dwellers get their own version of the benefit, plus an often-missed extra.

If your church provides you a home, the fair rental value of that parsonage, including utilities the church pays, is excluded from your income for federal income tax purposes. You do not report it as wages. IRS Topic 417 notes one ceiling: the exclusion cannot exceed reasonable compensation for your services.

The often-missed extra: even in a parsonage, you likely have out-of-pocket housing costs: utilities you pay yourself, furnishings, appliances, decor, cleaning supplies, yard tools. Your church can designate a cash "parsonage allowance" on top of the provided home to cover those expenses tax-free, subject to the same rules: designated in advance, in writing, actually spent on qualifying items, and documented with receipts.

Two cautions:

• Self-employment tax still applies. Unless you have an approved Form 4361, you must add the parsonage's fair rental value (plus utilities the church pays) and any cash allowance into your Schedule SE calculation. Ask your church for a reasonable fair-rental-value figure each year.
• Long-term planning matters. Parsonage pastors build no home equity, so it is especially important to save for retirement housing, ideally in a church-sponsored retirement account that can later pay out distributions designated as housing allowance.