Church Law & Tax Report

January/February 2019
Articles with a Member Access Only are available only to members.

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Feature Article

Richard Hammar Reviews Top 10 Tax Changes

Richard Hammar Reviews Top 10 Tax Changes Member access only

What to know for 2018 filing and 2019 compliance.

Articles

Monetary Gifts to Pastor Are Taxable Income

Monetary Gifts to Pastor Are Taxable Income Member access only

A recent major Tax Court ruling underscores key criteria for church leaders to follow.
Minimizing the Risks of Child Molestation in Churches

Minimizing the Risks of Child Molestation in Churches Member access only

How this new 13-step plan can help protect the most vulnerable.
How to Remove a Church Board Member

How to Remove a Church Board Member Member access only

Avoid potential litigation and internal strife with proper bylaws, policies, and procedures.

Recent Developments

Issues that affect ministers and churches, with Richard R. Hammar

Tax Calendar

Important deadlines for churches and ministers

January 1, 2019

  • Employees and employers each pay Social Security and Medicare taxes equal to 7.65 percent of an employee's wages. The tax rate does not change in 2019. The 7.65 percent tax rate is comprised of two components: (1) a Medicare hospital insurance tax of 1.45 percent, and (2) an “old‑age, survivor and disability” (Social Security) tax of 6.2 percent. There is no maximum amount of wages subject to the Medicare tax. The tax is imposed on all wages regardless of amount. For 2019, the maximum wages subject to Social Security taxes (the 6.2 percent amount) is $132,900. Stated differently, employees who receive wages in excess of $132,900 in 2019 pay the full 7.65 percent tax rate for wages up to $132,900, and the Medicare tax rate of 1.45 percent on all earnings above $132,900. Employers pay an identical amount. The Medicare tax rate for certain high-income taxpayers increases by an additional 0.9 percent.

January 15, 2019

Ministers (who have not elected voluntary withholding) and self-employed workers must file their fourth quarterly estimated federal tax payment for 2018 ...

January 30, 2019

Churches hiring their first nonminister employee between October 1 and December 31, 2018, may exempt themselves from the employer's share of Social ...

January 31, 2019

  • Churches having nonminister employees (or one or more ministers who report their federal income taxes as employees and who have elected voluntary withholding) must file an employer's quarterly federal tax return (Form 941) for the fourth calendar quarter of 2018 by this date. Enclose a check in the total amount of all withheld taxes (withheld income taxes, withheld Social Security and Medicare taxes paid by the employee, and the employer's share of Social Security and Medicare taxes) if less than $2,500 on December 31, 2018.

February 10, 2019

Churches having nonminister employees (or one or more ministers who report their federal income taxes as employees and who have elected voluntary withholding) ...

February 28, 2019

  • Churches file Copy A of Form 1098-C with the IRS by this date to report the sale or use of a donated vehicle. Generally, you must furnish Copies B and C of this form to the donor no later than 30 days after the date of sale if box 4a is checked, or 30 days after the date of the contribution if box 5a or 5b is checked. If box 7 is checked, do not file Copy A with the IRS and do not furnish Copy B to the donor. You may furnish Copy C to the donor. The donor is required to obtain Copy C or a similar acknowledgment by the earlier of the due date (including extensions) of the donor’s income tax return for the year of the contribution or the date that return is filed. File Copy A of this form with the IRS by February 28, 2019. If you file electronically, the due date is March 31, 2019.

Semiweekly requirements, January/February 2019

If your church or organization reported withheld taxes of more than $50,000 during the most recent lookback period (for 2019 the lookback period is July ...

Monthly requirements, January/February 2019

If your church or organization reported withheld taxes of $50,000 or less during the most recent lookback period (for 2019 the lookback period is July ...

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Youth Ministry in a #MeToo Culture

Youth Ministry in a #MeToo Culture Member access only

Develop boundaries and a reporting structure that keeps your youth program safe for everyone.
Essential Guide to Liabilities and Duties for Church Boards

Essential Guide to Liabilities and Duties for Church Boards Member access only

Be aware of ways you can expose yourself to personal legal liability.