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Letters to Potential Donors of Mission Trips
Wording is more important than you might think.

In the excitement of planning a mission trip, it's possible to overlook the importance of carefully worded support letters that meet IRS guidance. The IRS indicates what would be helpful to include in letters requesting charitable contributions, according to Dan Busby, president ...

Setting the Record Straight on Group Exemptions
Despite some claims, IRS revocations aren't in store.

The IRS Advisory Committee on Tax Exempt and Government Entities ("ACT") issued a report in June that addresses a number of tax compliance issues, including group exemption rulings.

The report caught the attention of many church leaders, since thousands of churches have obtained ...

IRS Increases Mileage Rate

The Internal Revenue Service announced this morning it has increased the optional standard mileage rate that employers can use to reimburse employees who drive personal vehicles for business purposes.

The IRS increased the rate to 55.5 cents per mile for travel occurring between ...

IRS Revokes Tax-exempt Status of Church-run Agency
275,000 nonprofits lost their tax-exempt status—some may be church-run

If your church runs a nonprofit agency, you may want to check this state-by-state list of 275,000 organizations whose tax-exempt status was recently automatically revoked by the IRS. Most organizations on the list no longer exist but some still do.

One organization on the list ...

Group Drops Case Against Pastor Housing Allowances
But battles loom as more challenges are promised.

A constitutional challenge to the tax-free housing allowances and parsonages provided to thousands of American pastors is over after the plaintiffs who filed the original lawsuit voluntarily requested its dismissal Friday in a California district court.

But the battle is far ...

More Analysis on the Pastor Housing Allowance Challenge
Supreme Court ruling may hurt standing of FFRF's case.

Last month, Richard Hammar wrote an article detailing new developments in the constitutional challenge to pastoral housing allowances under way in California.

In a separate case in Arizona, the Supreme Court ruled the plaintiffs there lacked standing for their case to proceed. ...

Bill Maher: Should Churches be Taxed?

A little more than a year ago, Bill Maher hosted actor Ashton Kutcher, author and editor Jon Meacham, and Florida Congresswoman Ileana Ros-Lehtinen on his HBO program, Real Time. A YouTube clip from the program circulated recently throughout social media circles.

Church leaders ...

Should the Jobless Tithe on Their Unemployment Benefits?
Three Christian leaders weigh in on a difficult giving question.

In the March edition of Christianity Today, three men with backgrounds in church and personal finances were asked whether the jobless should tithe on their unemployment benefits. Read their answers, then share how your church has (or hasn't) addressed this question as the unemployment ...

What's a Congregation Worth?
The "good news" of churches' work in communities.

As cities and counties continue to eye possible taxes and fees for churches and religious organizations, interesting new research from The University of Pennsylvania's Ram Cnaan examines the economic value of a congregation to its surrounding community.

Using information from ...

Expanded 1099 Reporting Requirements Repealed
New law nixes 'crushing administrative burden'

In the April edition of Church Finance Today, Richard Hammar previewed the possible repeal of the expanded 1099 reporting requirement included with the Patient Protection and Affordable Act (last year's health care reform legislation).

The requirement would have required all ...

A Tax Credit for Churches?
Potentially thousands of dollars available from health care provision.

Editor's Note (September 29, 2011):A church business administrator in Colorado shared the following update regarding his church's application for this credit: "We submitted form 990-T claiming the credit (approximately $7,100) in late April. We received a request ...

Should Congress Change Pastors' Housing Allowances?
Several voices weigh in on an important tax benefit for clergy.

The newest issue of Christianity Today poses an interesting question: Should Congress change pastors' housing allowances?

Expect to hear a lot more on the topic in the weeks and months ahead. Since the conclusion of Sen. Charles Grassley's (R-Iowa) financial investigation of ...

Would a Change to Charitable Contributions Rules Hurt Churches?
State of the Plate survey suggests concerns--but are those valid?

One angle covered by secular media during the recent release of the 2011 State of the Plate survey results: The possible affects of a current "federal proposal to reduce tax deductions for charitable donations among wealthy Americans," as CNN.com reported Wednesday.

Cathy Lynn ...

Church Giving Begins to Rebound?
6 in 10 churches held—or gained—ground in 2010.

Since the recession in 2008, many U.S. churches have seen a decline in giving. But the tide may be changing. The third annual State of the Plate constituency survey of 1,507 churches revealed that 43% of these churches experienced an uptick in giving this past year (up from ...

Handling Leases for Car Allowances
Accounting for this type of option for vehicles.

Question: Our church provides an auto allowance budget line item for vehicle expenses for our pastor. The pastor leases a vehicle that he uses for church-related business. He has asked to use the budget line for reimbursement of the expenses associated with the leased vehicle's ...

The Fall-Out from 'Natural Decrease'

Editor's Update (4/26/2011):The Nonprofit Quarterly pointed this morning to a Boston Globe article reporting 40 of the city's largest nonprofits, with property valued at $15 million or more each, have received letters from the city "requesting them to make regular and voluntary ...

Holiday Pushes Back Due Date for Taxes
Federal tax-filers get a few extra days.

Haven't started your federal taxes yet?

As February fast draws to a close, you may be encouraged to know that you get an extra three days to work on 2010 filings. From this morning's Richard Hammar's Essential Reminders:

"Taxpayers will have until Monday, April 18 to file their ...
Online Resource for Church Law and Tax Help
ChurchLawAndTax.com offers leaders comprehensive info

We're pleased to announce the launch of ChurchLawAndTax.com (formerly ChurchLawToday.com).

We've given the site a fresh, new look to serve church leaders like you even better. You'll find an updated Archives of the Church Law & Tax Report newsletter through 2010 (that's nearly ...

Help for Pastors During Tax Season
Upcoming resources to help wade through tax laws that affect clergy.

The "The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010," passed by Congress and signed by President Obama in mid-December, triggered a domino-like effect of changes for tax-filers–so much so that even the Internal Revenue Service delayed its ...

Ten Steps to Tax Reporting
A new, free PDF offers helpful payroll tax reminders for churches.

Looking for a helpful–and easy–way to remember federal payroll tax reporting requirements as a church? Check out this handy, printer-friendly PDF we've prepared titled "Ten Steps to Tax Reporting."

Here's a sneak peek:

10) Complete Forms 1099-MISC and 1096. Must be issued to any ...

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Receipts for Donors

Receipts for Donors  Member access only

16 letters and forms for providing receipts to donors for different donations.
Church Finance

Church Finance Member access only

Learn about budgeting, financial reporting, tax compliance, insurance coverage, and more.