Minister is retired and has designated part of pension for housing allowance. Pastor will take a temporary position out of state as pastor and will be provided housing and utilities at that location. My thinking is the pastor can exclude the temporary housing but can not exclude the pension for the same time frame?
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My read is he can have his cake and eat it too. He can only have the retirment monies designated as housing if he has clearly retired. You indicated that he has. As long as he does not enter into a permanent relationship (more than a year) at a church he can still receive those monies as housing allowance with no SE tax on it. If he qualifies in the interim position as a dual-status pastor, and you seemed to indicate that he does, then that church can also pay him a housing allowance subject to SE tax (unless he is exempted).
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