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17 Ways the Church May Become Accountable to the State
Grassley Commission Outlines Progress on Key Points

Should the IRS form an advisory committee to oversee church tax law? Is the clergy housing exclusion constitutional? To what extent should churches be accountable to the government for the way in which they operate? These are three of the seventeen issues the year-old Commission ...

Commission on Financial Practices Seeks Input from Churches
Online town hall meeting scheduled for Friday.

A little more than a year ago, Sen. Chuck Grassley (R-Iowa) asked the Evangelical Council for Financial Accountability to oversee an independent commission tasked with evaluating several financial and tax matters related to churches and nonprofit ministries. The goal: Determine ...

Extension of Payroll Tax Holiday Appears Likely
Churches will need to verify employee withholdings are correct.

Congress appeared close late Tuesday to passing an extension of the payroll tax holiday through December 31, 2012, for millions of workers. A bill may be finalized Wednesday and put before President Obama for signature by the end of the week, the Associated Press reported.

The ...

Appeals Court: No Housing Allowances for Two Homes

A federal appeals court ruled Wednesday that the ministerial housing exclusion in the Internal Revenue Code is indeed limited to a single home.

The ruling overturns a split Tax Court decision (Driscoll v. Commissioner, 135 T.C. No. 27 (2010)) in which the lower court had ruled ...

The Top 7 Paid Positions at Churches

Editor's Note: The 2014-2015 Compensation Handbook for Church Staff is now available. This resource details pay and benefits data for 14 church positions, including two new ones–part-time musician and part-time childcare provider. Each position is analyzed based on a variety ...

Penalties Double for Late 1099s

Editor's Note (02/21/12): A previous version of this post incorrectly stated the deadline for Form 1099s that are mailed. The correct dates are now shown in the post.

Form 1099s that are mailed are due on February 28, 2012, for the 2011 tax year (April 2, 2012, for those filing ...

How Much Are Pastors Earning These Days?

How much are the pastors of Protestant churches nationwide earning these days?

The chart below shows the national averages for compensation and benefits earned by full-time senior pastors, based on Christianity Today's biannual survey of 4,600 churches nationwide. The survey ...

Year End Giving
These tax rules determine if contributions should apply to 2011 or 2012.

December often brings more contributions to churches than any other month. Be prepared to handle year end contributions accurately by listening to Richard Hammar describe a number of important rules that apply to year end giving in the video below:

To learn more about how ...

December Tax Tip: Plan Now to Reclassify an Employee
Changing a minister to 'employee' status should happen January 1.

If you have a minister or lay worker who is treated as self-employed for federal income tax reporting purposes, but who you would like to reclassify as an employee, the ideal time to make the change is on January 1 of the new year.

December Tax Tip: Update Staff W-4s Now
New laws, life changes have likely affected many.

December is a good time to check with all nonminister church employees to see if they need to file a new W-4 form with the church. The W-4 form is used by employees to report withholding allowances. This information will determine how much income tax the church withholds from ...

The Church Bulletin as a Tax Tool

To avoid jeopardizing the tax deductibility of charitable contributions, churches should advise donors at the end of 2011 not to file their 2011 income tax returns until they have received a written acknowledgement of their contributions from the church. This communication should ...

Renting Out Extra Space May Cost Churches
One Idaho church receives an unexpected tax bill.

A church in Boise, Idaho, received an unexpected property tax bill of $17,000 for leasing space to a local YMCA daycare, according to Northwest Cable News. The church charges the nonprofit about $9,500 a month to rent space often left unused during the week.

The county attorney ...

Endorsing Candidates from the Pulpit
"Pulpit Freedom Sunday" raises questions as Election Day draws near.

This past Sunday, the Alliance Defense Fund expected nearly 500 church pastors nationwide to participate in "Pulpit Freedom Sunday." The event, organized for four consecutive years by ADF, is designed to challenge a 1954 amendment to the

501( c) 3 tax code that ...

Tax Scammers in Person
Teams of people posing as tax service companies knock on church doors.

The most common way tax scammers seem to work is through e-mail. Countless e-mails arrive daily in inboxes claiming a tax refund is available.

Many tax scammers have become less shy recently, according to a recent IRS news release and an Oklahoma news service. They walk ...

Who Owns a Pastor's Sermons?
Most clergy are shocked when they learn the answer.

Most clergy would be shocked to learn that their sermons are works made for hire that are owned by their employing church, and that their sermons cannot be used in any other churches with which they are later employed without the permission of the church with which they were ...

Church Puts Property Up for Sale After Tax Dispute
City says land can be assessed.

An ongoing property tax assessment battle between Concord, N.H., and a 50-member church there has led to the church putting its property up for sale to make ends meet, according to a recent article in the Concord Monitor.

Four years ago, the city assessed taxes for the property ...

Cartoon: Giving for Tax Purposes

If you've ever created receipts for church offerings and donations, you've probably been asked to receipt donated property.

On a more serious note, Richard Hammar offers a couple of lessons on how to meet IRS requirements for non-cash contributions of $5,000 or less and $5,000 ...

One Church Receives an Unexpected Tax Bill
Why churches must understand unrelated business income.

A church in Mount Vernon, Washington, thought it didn't owe taxes. But that changed after a recent state audit, when the state said the church owed $180,000 in back taxes and penalties, according to a TV news station.

The church charges admission to a small amusement center. ...

Scammers 'Phishing' for Your Money
If free money sounds too good to be true, it probably is.

Editor's Note (August 15, 2011):Naomi Martin, a reporter with The New Orleans Times-Picayune wrote this article for the newspaper on Sunday. It provides additional details on how some of these scams approach church leaders.

In July, the IRS urged its Twitter followers to be leery ...

The Proposed Charitable Deduction Change
Differing views on whether a change will affect giving to churches.

The president has proposed a 2012 budget that will decrease the value of itemized tax deductions, including deductions for charitable contributions, for individuals making $200,000 or more and families making $250,000 or more per year. Also in the proposed budget is a tax increase ...



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Your Guide To Employee Handbooks

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If updated regularly, an employee handbook can offer valuable legal protection against civil court claims made by disgruntled staff members.
Increase Giving at Church

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Develop practical and digital strategies to cultivate a culture of giving.