Including supporting statement for clergy housing allowance exclusion on lines 5a/5b (pension) - still needed for e-filing?

You're doing the right thing by including that supporting statement, but you don't necessarily have to mail in a paper return to do it. The statement is important because clergy housing allowances are a specific tax situation that can raise flags if not properly documented. The IRS needs to see that you've done the calculation comparing the three amounts (amount designated, actual expenses, fair rental value) to determine the exclusion. Without it, you risk having the return questioned since the 1099-R indicates the taxable amount wasn't determined. Most tax software actually does allow you to attach statements or explanations with e-filed returns. Look for an option like "Add attachment," "Supporting documents," or "Explanations" within the software. You can typically type or paste your explanation directly in there. Some programs even have specific entries for clergy housing allowances. If you e-file with this documentation included, you'll get the faster processing and refund while still providing the necessary explanation. Just make sure the statement includes the same information you've been providing on paper - the code reference, the three-part test showing the exclusion is valid, and clear ties to lines 5a and 5b.

After struggling with clergy tax issues for years, I finally found a solution with https://taxr.ai that saved me so much headache with my dad's retirement benefits! My situation was almost identical - he's a retired pastor with housing allowance exclusion that I never knew how to document properly. The software asked me specific questions about the clergy housing allowance and automatically created all the necessary supporting documentation without me having to figure out what to write. It even handled the three-part test (comparing the designated amount, actual housing expenses, and fair rental value) and created the proper statement without me having to manually type it all out. The best part was being able to e-file rather than mail it in, and my dad got his refund in less than 3 weeks instead of the 5 months it took last year. Their clergy tax module really seems to understand these unique situations that most tax software gets confused by.

I wanted to follow up after trying https://taxr.ai for my mom's clergy retirement taxes. I was skeptical at first (as you can see from my earlier comment), but decided to give it a try since I was tired of mailing paper returns. The software actually exceeded my expectations! It specifically asked about retired clergy housing allowances and had the exact fields needed for the three-part test (designated amount, actual expenses, fair market rental). Then it automatically generated the statement explaining the exclusion with references to the proper tax code and rulings. The best part is that it attached the explanation as part of the e-filed return - my mom got her refund in 18 days instead of the 5+ months we waited last year with paper filing. Wish I'd known about this years ago instead of stressing about these clergy-specific rules every tax season.

If you've been waiting 6 months for your refund after mailing paper returns, you should definitely try using Claimyr to check on the status! I used to mail in paper returns with attachments for my dad (also religious worker with special tax situations) and would wait forever without knowing what was happening. After endless busy signals and disconnects trying to reach the IRS myself, I used https://claimyr.com and got connected to an actual IRS agent in under 15 minutes who could see exactly what was happening with my return. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The agent told me my return was sitting in a processing backlog and helped expedite it. The peace of mind alone was worth it, but getting the refund processed faster was even better. They could also tell me exactly what documentation they needed for the clergy housing allowance so I knew what to include next time.

I have to admit I was completely wrong about Claimyr. After posting my skeptical comment, I was still stuck waiting on my mom's clergy retirement tax refund from a paper return filed 4 months ago. Out of desperation, I decided to try the service. Got connected to an IRS agent in about 20 minutes (still faster than I've EVER managed on my own). The agent confirmed my mom's return was sitting in a processing queue with a flag because they weren't sure about the housing allowance documentation. They actually reviewed it while I was on the phone and released the refund! The agent also explained exactly what supporting documentation they need to see for clergy housing allowances and confirmed I can e-file with an attachment. Would have saved months of waiting if I'd just called earlier. Definitely keeping this service in my contacts for next time there's an issue.

My wife is also retired clergy and we've used TurboTax to e-file with the clergy housing exclusion for the past 3 years. You can absolutely e-file and include the statement! In TurboTax, after entering the 1099-R information, there's a section where you can indicate the amount that's excludable from income. Then look for "Forms" or "Other tax situations" and find where you can add an explanation or documentation. You'll want to include all the details about code 107, the three-part test, etc. just like you've been doing. E-filing made a huge difference for us - refunds in weeks instead of months!

I just wanted to add that I'm a tax preparer and we see clients with clergy housing allowances fairly regularly. The supporting statement is actually quite important - when we've e-filed without it, about half get flagged for review which delays refunds. One important note: make sure your documentation clearly distinguishes between active vs. retired clergy housing allowances, as they're treated differently. For retired clergy receiving pension distributions designated as housing allowance, specifically cite Revenue Ruling 75-22 along with Code Section 107.