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Accountable Reimbursements Prove Best Way to Handle Ministry Expenses
Your employees will thank you.

The best way for ministers to handle their ministry-related business expenses is to have their employing church adopt an accountable expense reimbursement arrangement. An accountable arrangement is one that meets the following four requirements: (1) only business expenses are ...

Obamacare: What's Next for Churches
Is your church ready?

The recent temporary fix on Capitol Hill helped the government avoid defaulting on its debt obligations. Republicans and Democrats now continue discussions about a fiscal budget, and with funding still in place for the Affordable Care Act, its implementation remains on track. ...

Five Takeaways from the November 2013 Housing Allowance Ruling
Richard Hammar offers key points regarding Wisconsin judge's ruling.

UPDATE (12/2/13): Below are five immediate takeaways from Richard Hammar on the November 22, 2013, ruling on clergy housing allowances by a federal judge in Wisconsin. Rich goes deeper on these five, plus five more, in the January/February issue of Church Law & Tax Report. ...

Q&A: Is Donated Parking Space Tax Deductible?

Q: A church member allows us to park our buses at his business. We used to pay $200 a month for this service. In the past we have given this church member a letter indicating a donation of $2,400 per year, which he could use as a charitable contribution. Our question is, "What ...

One Key, End-of-Year Task Every Church Should Do
Providing simple reminders can help ensure tax deductibility of donations for churchgoers.

A number of tasks need to be done before the end of the year, but there's one that can easily be done with the handy tool of the church bulletin or newsletter: Include information that will help donors ensure the tax deductibility of their charitable contributions.

Richard Hammar ...

How Does the Affordable Care Act Affect Churches?
Attorney Frank Sommerville walks churches through the next two years of changes.

Q: What are some provisions of the Affordable Care Act that take effect in 2013 and 2014 that churches should be aware of?

A: Well, the biggest provision that affects 2013 is going to be changing your cafeteria plan limit for medical expenses to $2,500. But the really big problem ...

Gifts of Money to Pastors
If money is collected and distributed by the employing church, it may be taxable income.
Gifts of Money to Pastors
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Some church members give their pastor, or other church employee, a personal gift on special occasions such as a $20 bill enclosed with a birthday card. These personal gifts may be treated as nontaxable gifts by the pastor because they were not distributed by the employing church. ...

Neglecting to "Render Unto Caesar"
Failure to file income tax returns can get new ministers into hot water.

Ministers—especially new ones—often fail to file income tax returns. It's a common problem, because churches are not required to withhold either income taxes or Social Security taxes from the wages of ministers who are performing ministerial services. This occurrence ...

Churches: The IRS is Substantially Closed, But Your Obligations Remain

Editor's Note (10/17/2013): Congress passed a bill last night that ended the shutdown. President Obama signed the bill ahead of the default deadline that loomed at 11:59 p.m.

Due to the lapse in federal government appropriations (the so-called "government shutdown"), substantial ...

Q&A: Donated Goods and Charitable Statements

Q: I occasionally have a church member who donates something the church needs. The member then gives me a receipt for the item purchased and asks me to put it on their giving statement. Is this allowed?

A: No, it cannot go on the member's cash contribution receipt because the ...

Q&A: Our Pastor Died—Can We Financially Help the Spouse?
Be aware of how the IRS views aid to employees' family members.

Q: A pastor passes away. The church wants to give the widow a small amount of monthly income for the remainder of the year. How is this gift treated from a tax standpoint?

A: It is best to treat this as taxable income in recognition of the pastor's services. Churches cannot ...

Q&A: Outside Groups and the Church Building

Q: We have several groups that call and ask to use the church building for meetings. If we set a price for rental, is that taxable income? If we suggest a donation or just ask for a tithe off their offering, does that affect our tax status? Also, what are things that we need ...

Q&A: Should This Pastor's Car Repair Reimbursement be Taxed?

Q: I need help with a question regarding money requested for our Deaf Church Pastor for car repairs. The Deaf Church Committee voted to reimburse him for the car repairs but since this is not an actual church expense, it seems it should be considered a gift, and therefore taxable ...

Senate's Tax Reform Could Greatly Impact Charities

Senate Finance Committee Chairman Max Baucus and Ranking Member Orrin Hatch publicly announced Friday their much-anticipated plan for next steps on comprehensive tax reform. The announcement and a related letter to Senate colleagues made clear the Finance Committee's strategy ...

Should Churches Reject Tax Exemption, As Huckabee Suggests?
Such a move might trade one set of potential problems for another.

Mike Huckabee raised an intriguing, provocative question on Monday while addressing pastors ahead of the Southern Baptist Convention annual meeting in Houston: Should churches reject their tax-exempt status as a way to break free of government oversight and restriction?

According ...

Q&A: Which House Qualifies for the Housing Allowance?

Q: I know the recent Driscoll decision means a pastor can't claim two homes for his or her housing allowance. In a situation where a pastor answers a call in one state, but his or her family stays behind to sell the current residence and to allow the kids to finish school, which ...

Q&A: Should the Church's Payroll Include Youth Providing Childcare?
A common practice may trigger unexpected paperwork.

Q: When we have youth from our high school youth group do childcare for church events, do they need to be put on the payroll? In the past we have just paid them from the ministry fund they are babysitting for.

A: Yes. Also, your church is covered by minimum wage and child labor ...

Q&A: Are Proceeds From the Church Community Center Taxable?
A prime outreach opportunity raises financial, tax considerations.

Q: Our church's new community center includes a gym, and a coffee shop for people to fellowship and drink coffee while watching their younger children on our playground just outside the building. We also host a church basketball league involving other churches. All the fees ...

How Much is a Volunteer's Time Worth?
How churches might use this nonprofit-sector calculation.

How much is a volunteer's time worth? About $22.14 an hour, according to a new Independent Sector calculation.

The organization uses Bureau of Labor Statistics information, looking at payroll averages of nonfarm, nonsupervisory labor and adding a percentage for benefits. Although ...

What's Next: Will Church Bonds Make a Comeback?
Tight lending conditions may renew interest on a wider scale.

Editor's Note:This is the final post in a guest series from Dave Travis' book, What's Next?:2012 Edition. The first posts addressed church finances, financial accountability, the use of interns and residents, and outsourcing work. Travis is CEO of Leadership Network.

Church ...

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Church Board Guide to Developing a Risk Management Strategy

Church Board Guide to Developing a Risk Management Strategy Member access only

Learn why it is essential your church develop a risk management strategy and how to implement the strategy in your church.
Understanding Pastoral Liability

Understanding Pastoral Liability Member access only

Know the situations in which a pastor is personally liable for wrongdoing.