403(b)(9) plans are specifically designed for employees of churches and ministries that have a church designation, and the IRS allows denominational pension boards to designate a housing allowance for retired pastors receiving income. This special condition allows ordained ministers to take non-taxable, housing allowance distributions of up to 100% of annual retirement benefits. It is important to note that the clergy Housing Allowance will not apply to funds rolled out of the plan to other institutions. Commercial investment funds do not have the ability to designate payments as housing allowance, and ministers cannot make the designation on their own return. Inquiries or comments? If you have any questions, we encourage you to contact us today!
