403B PASTORS HOUSING ALLOWANCE

Submitted by Douglas Bauerband on Fri, 2016-03-18 20:27

I KNOW IF THEY ARE WORKING THEY DO NOT HAVE TO TAKE OUT THE RMD FROM THE 403B UNTIL AGE 75, BUT…

A. DO THEY HAVE TO BE WORKING FULL TIME OR CAN THEY BE WORKING PART TIME TO STILL AVOID TAKING RMD’S FROM THE 403B UNTIL 75?

B. ONCE THEY ARE RETIRED AT WHATEVER AGE, CAN THEY STILL TAKE THE MAXIMUM HOUSING ALLOWANCE FROM THE 403B OR DOES IT REDUCE ONCE THEY RETIRE?

C. IF IT DOES REDUCE WOULD YOU KNOW HOW MUCH THE REDUCTION IS…BASED ON INCOME OR A FACTOR?

THANK YOU,
DOUGLAS

Permalink Submitted by Alan - IRA critic on Sat, 2016-03-19 00:11

A) If minister is still working as defined by the church, RMDs do not have to start until retirement. Then, when they do start, any 403b balance as of 12/31/1986 is exempt from RMDs until age 75.
B) This is also determined by the church (former employer). Retired minister may have to get ahold of several prior employers who may supply different answers to this question.
C) Reduction could vary, but once the minister determines the total housing allowance from various prior employers, that amount is not taxable when withdrawn from the 403b whether as part of the RMD or not.

Permalink Submitted by Douglas Bauerband on Mon, 2016-03-21 23:24

is there a rule or equation you have to follow?