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Weekly Lessons, created and written by Richard R. Hammar, J.D., LL.M., CPA, give you a basic legal overview of essential topics based on staff or volunteer positions within a church.

Previous Lessons

Week of June 28

Who is a Minister?

This Week's LessonWeek of July 5

Tax Issues Associated with Cell Phones

Introduction

Our lesson this week examines the topic of cell phones. The Executive Summary provides a concise review of the key points. Before we get started, test your knowledge by completing the following quiz.

A church provides its pastor with a cell phone, and pays the standard monthly fee of $80 for a specified number of minutes. The pastor keeps no records to establish the business use of the phone. The church treasurer assumes that none of the monthly cell phone payments made by the church should be reported as taxable income to the pastor since the phone was provided for business and not personal use. Is this correct? For the current year, the church not only made twelve monthly payments of $80, but paid an additional $300 for minutes in excess of the maximum allowed under the plan. Should any of the payments made by the church have been reported as taxable income to the pastor? If ...

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