The holiday season is upon us, and it can distract our attention from some important end-of-year tax and administrative responsibilities. Here is a simple list that will quickly assist church treasurers in handling the more important of these tasks.
Housing allowance. The board or congregation should designate a housing allowance for the upcoming year for ministers who own or rent their home (and for ministers who live in a parsonage and who pay some of their housing expenses). Here is a sample housing allowance resolution that your church can customize.
W-4 forms. 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 wages of a nonminister employee. W-4 forms often become obsolete because of changes in an employee's circumstances, but the employee fails to submit a new form to the church. This can result in withholding that is significantly above or below the actual tax liability.