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When the IRS Comes Knocking

New guide identifies key audit issues.

The new "Audit Technique Guide for Ministers," which was released on June 30, 2009, provides important insight into the key issues the IRS will scrutinize when they audit ministers. The new guide begins by noting that "ministers are accorded some unique tax benefits for income, social security and Medicare taxes, which present several potential examination issues on ministers' tax returns in addition to income and expense issues found in most examinations." The guidelines list the following topics that are "unique to ministers":

  1. Introduction: Overview Of Issues
  2. Who Qualifies For Special Tax Treatment As A Minister
  3. Income Issues:
    • Income To Be Reported
    • Gift or Compensation for Services
    • The Parsonage Allowance
    • Retired Ministers
    • Members of Religious Orders and Vow of Poverty
  4. Business Expenses
    • Determination of Deductible Expenses Where Some Income is Tax Exempt

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Posted:
  • November 2, 2009

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