Article 4 volume 6 December 23, 2015
Too Many churches are ignorant or just don't care when it comes to obeying IRS Church Laws
Monetary Gifts to adults and students
For students, the gifts may range from $25 to $5000. It all depends on the reason for the gift.
A gift of $25 to $50 sounds okay. Anything more than that should be based on a documented need. If the need is more than $100, we recommend that the funds come from the Missionary Account.
Also, the students should be given an IRS form 1099. Many churches believe it is not necessary because the gift is under $600. That is a false assumption.
Stipends to employees or anybody should be treated as taxable income.
Stipends to employees or anybody should be treated as taxable income.
Monetary Gifts to Staff and Others
Gifts are okay. But if the person is working as an employee, he/she should be paid an annual salary and given an IRS W-2 form.
These gifts are often called stipend and no 1099 or W-2 forms are given.
Will your pastor be shortchanged on his or her income?
Far too many churches are shortchanging their pastors in salary and parsonage allowances. Based on a recent survey about 80% of the pastors payments and allowances are incorrect.
Many churches do not know that: the parsonage allowance has to be approved and recorded in the church official records before the beginning of the year that it will be effective; pastors who own their homes are eligible for parsonage allowance; pastors who receive 1099's for their service may be ineligible for health care and retirement benefits and pastors can save $5,000 or more on their tax returns, legally if their income and deductions are prepared properly. Much more!
Budget
Will your church prepare a valid budget? A budget consists of projected income and expenditures for the coming year. A document that only list projected expenditures cannot be considered a budget. Likewise, a document that only list projected income cannot be considered a budget. Both must be combined to form a budget document.
Let's celebrate the Birth of Christ, we will talk business later.
Merry Christmas and Happy New Year!!
Copyright 2015. Grady E. Bryant, Sr.
Will your pastor be shortchanged on his or her income?
Far too many churches are shortchanging their pastors in salary and parsonage allowances. Based on a recent survey about 80% of the pastors payments and allowances are incorrect.
Many churches do not know that: the parsonage allowance has to be approved and recorded in the church official records before the beginning of the year that it will be effective; pastors who own their homes are eligible for parsonage allowance; pastors who receive 1099's for their service may be ineligible for health care and retirement benefits and pastors can save $5,000 or more on their tax returns, legally if their income and deductions are prepared properly. Much more!
Budget
Will your church prepare a valid budget? A budget consists of projected income and expenditures for the coming year. A document that only list projected expenditures cannot be considered a budget. Likewise, a document that only list projected income cannot be considered a budget. Both must be combined to form a budget document.
Let's celebrate the Birth of Christ, we will talk business later.
Merry Christmas and Happy New Year!!
Copyright 2015. Grady E. Bryant, Sr.
