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Clergy Housing Allowance Exclusion in Tennessee 2026

Calculate your clergy housing allowance exclusion tax savings in Tennessee. Tennessee has no state income tax, so savings come from the federal level.

Tennessee Tax Overview

State Income Tax
None
none
Sales Tax
7%
avg combined: 9.55%
Property Tax Rate
0.66%
Median Income
$59,695

No income tax (Hall Tax repealed 2021). Highest combined sales tax (tied 9.55%). Low property taxes.

$1,100
Est. Total Savings
No Limit
Max Deduction
Above-the-Line
Deduction Type
22.0%
Combined Tax Rate

Clergy Housing Allowance Exclusion Savings Calculator for Tennessee

$
$

Federal Savings

$1,100

22% bracket

Tennessee State

$0

0% rate

Total Savings

$1,100

22.0% combined

At a 22.0% combined tax rate in Tennessee, every $1,000 in deductions saves you $220 in taxes.

Savings by Tax Bracket in Tennessee

10%
$500
12%
$600
22%
$1,100
24%
$1,200
32%
$1,600
35%
$1,750
37%
$1,850

Tennessee has no state income tax — savings are from federal taxes only.

Eligibility Requirements

Ministers and clergy who receive a housing allowance as part of compensation

  • 1Must be ordained, licensed, or commissioned minister
  • 2Allowance must be designated by employer in advance
  • 3Limited to lesser of: actual expenses, FMV of home, or designated amount

Common Mistakes to Avoid

  • !Not having allowance designated before payment
  • !Exceeding the fair market value limitation
  • !Forgetting to include for self-employment tax purposes

Tennessee Filing Tips

No income tax is a major benefit. Be aware of very high combined sales tax. Low property taxes help offset. No estate or inheritance tax.

Required Tax Forms

Form 1040Schedule SE

File these forms with your federal tax return to claim the clergy housing allowance exclusion.

Other Tax Deductions in Tennessee

Mortgage Interest Deduction

Housing

~$3,500
est. savings

Property Tax Deduction

Housing

~$2,200
est. savings

Home Office Deduction

Housing

~$1,200
est. savings

Home Energy Tax Credit

Housing

~$1,800
est. savings

Residential Solar Tax Credit

Housing

~$7,500
est. savings

Military Moving Expenses

Housing

~$4,000
est. savings

PMI Premium Deduction

Housing

~$1,100
est. savings

Mortgage Points Deduction

Housing

~$2,000
est. savings

Clergy Housing Allowance Exclusion in Neighboring States

Kentucky

4% top rate (flat)

~$14,182
+13,082 vs Tennessee

Virginia

5.75% top rate (progressive)

~$15,136
+14,036 vs Tennessee

North Carolina

4.5% top rate (flat)

~$14,455
+13,355 vs Tennessee

Georgia

5.49% top rate (flat)

~$14,995
+13,895 vs Tennessee

Alabama

5% top rate (progressive)

~$14,727
+13,627 vs Tennessee

Mississippi

4.7% top rate (flat)

~$14,564
+13,464 vs Tennessee

Arkansas

4.7% top rate (progressive)

~$14,564
+13,464 vs Tennessee

Missouri

4.8% top rate (progressive)

~$14,618
+13,518 vs Tennessee

Tax Calculators for Tennessee Cities

NashvilleMemphisKnoxvilleChattanoogaClarksvilleMurfreesboroFranklinJohnson CityJacksonHendersonville

Calculate Your Full Tax Savings in Tennessee

Use our free tax calculators to optimize your entire tax return for Tennessee.

Income Tax CalculatorTennessee Income TaxFull Clergy Housing Allowance Exclusion Guide

Frequently Asked Questions

How much can I save with the Clergy Housing Allowance Exclusion in Tennessee?

In Tennessee, the clergy housing allowance exclusion can save you an estimated $1,100 per year on a $5,000 deduction. This includes $1,100 in federal tax savings. The national average savings is $12,000/year.

What is the Tennessee state income tax rate?

Tennessee has no state income tax, which means the clergy housing allowance exclusion only provides federal tax savings for Tennessee residents. No income tax (Hall Tax repealed 2021). Highest combined sales tax (tied 9.55%). Low property taxes.

Who qualifies for the Clergy Housing Allowance Exclusion in Tennessee?

Ministers and clergy who receive a housing allowance as part of compensation. The eligibility requirements are the same whether you live in Tennessee or another state, as this is a federal tax deduction. However, your total savings will vary based on Tennessee's lack of state income tax.

What tax forms do I need to claim the Clergy Housing Allowance Exclusion in Tennessee?

To claim the clergy housing allowance exclusion, you need to file Form 1040 and Schedule SE with your federal return. Filing status affects your deduction limits and tax bracket.

Is the Clergy Housing Allowance Exclusion better in Tennessee than in states without income tax?

Since Tennessee has no state income tax, the clergy housing allowance exclusion only reduces your federal tax bill. Residents in states with income tax get additional state-level savings. However, Tennessee residents often benefit from lower overall tax burden.

What is the standard deduction in Tennessee for 2026?

Tennessee has no state income tax, so there is no state standard deduction. The federal standard deduction for 2026 is $14,600 for single filers and $29,200 for married filing jointly.

Related Calculators

Mortgage Interest Deduction in Tennessee

Avg savings: $3,500/year

Property Tax Deduction in Tennessee

Avg savings: $2,200/year

Home Office Deduction in Tennessee

Avg savings: $1,200/year

Home Energy Tax Credit in Tennessee

Avg savings: $1,800/year

Residential Solar Tax Credit in Tennessee

Avg savings: $7,500/year

Military Moving Expenses in Tennessee

Avg savings: $4,000/year