If you are an ordained minister with Fundamental Baptist Missions International and are actively serving as such, you are allowed by the IRS to designate part of your income as a housing allowance. The housing allowance will reduce your federal and state taxable income. A housing allowance is comprised of all of the expenses directly incurred in providing a home for your family, including rent, utilities, and other expenses. You must be able to prove the actuality of these expenses to the IRS. This designation must take place on an annual basis, in addition to any time that these details change.