Q&A: Can We Give an Honorarium to a Visiting Missionary?

Why purpose, amounts, and the right visa make a world of difference.

We have been supporting a pastor in South Sudan for many years. However, we have not been able to send him support for some time, due to the lack of a qualified organization (he’s currently displaced in Juba and serving other displaced people).
He will be in the US for a conference at the end of this month. If we give him an honorarium for speaking at our church, are there any restrictions on the amount we can give or on his eligibility to take the money back to South Sudan? There is nothing in place to track how he uses the money once he returns to the country he’s serving.
The answer depends on the visa the pastor received to visit the US. If he has a tourist visa, he may not receive any compensation from you. If he received a US visa that allows him to earn an honorarium while in the US, you may pay him a reasonable honorarium, like you would pay any other guest minister speaking at your church.
Payments to nonresident aliens are first classified according to where the services are being rendered.
If the payment is for services in the US, the tax implications ensue. If the nonresident alien is in the US for less than 90 days within a calendar year (“personal presence test”) and the church’s payment is less than $3,000 for the entire calendar year (“income test”), then no US tax rules are implicated. If the nonresident alien is from Mexico or Canada, the nonresident alien must be in the US less than 183 days during a calendar year. If either the personal presence test or the income test is not complied with, then the church must comply with the tax rules.
Assuming the personal presence test or the income test is not met, the church must withhold 30 percent of the payment, unless a treaty changes the rate.
Some nonresident aliens qualify for exemption from mandatory withholding. To receive the exemption, the nonresident alien must give the church IRS Form 8233. The church must send the IRS the Form 8233 at least ten days before any payments are made. Since Form 8233 requires a taxpayer identification number, the nonresident alien may submit Form W-7, the Application for Taxpayer Identification Number, with Form 8233. Without Form 8233, the 30 percent withholding is mandatory.
If the personal presence test or the income test is not met and Form 8233 is not filed in a timely manner, the 30 percent withholding will apply unless a treaty sets a lower rate. To determine whether a lower rate applies, the nonresident alien must fill out Form W-8ECI and give it to the church.
If any withholding applies, the church should issue Form 1042-S to the nonresident alien and file the original with the IRS along with the amount withheld.
Frank Sommerville is a both a CPA and attorney, and a longtime Editorial Advisor for Church Law & Tax.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations." Due to the nature of the U.S. legal system, laws and regulations constantly change. The editors encourage readers to carefully search the site for all content related to the topic of interest and consult qualified local counsel to verify the status of specific statutes, laws, regulations, and precedential court holdings.

ajax-loader-largecaret-downcloseHamburger Menuicon_amazonApple PodcastsBio Iconicon_cards_grid_caretChild Abuse Reporting Laws by State IconChurchSalary Iconicon_facebookGoogle Podcastsicon_instagramLegal Library IconLegal Library Iconicon_linkedinLock IconMegaphone IconOnline Learning IconPodcast IconRecent Legal Developments IconRecommended Reading IconRSS IconSubmiticon_select-arrowSpotify IconAlaska State MapAlabama State MapArkansas State MapArizona State MapCalifornia State MapColorado State MapConnecticut State MapWashington DC State MapDelaware State MapFederal MapFlorida State MapGeorgia State MapHawaii State MapIowa State MapIdaho State MapIllinois State MapIndiana State MapKansas State MapKentucky State MapLouisiana State MapMassachusetts State MapMaryland State MapMaine State MapMichigan State MapMinnesota State MapMissouri State MapMississippi State MapMontana State MapMulti State MapNorth Carolina State MapNorth Dakota State MapNebraska State MapNew Hampshire State MapNew Jersey State MapNew Mexico IconNevada State MapNew York State MapOhio State MapOklahoma State MapOregon State MapPennsylvania State MapRhode Island State MapSouth Carolina State MapSouth Dakota State MapTennessee State MapTexas State MapUtah State MapVirginia State MapVermont State MapWashington State MapWisconsin State MapWest Virginia State MapWyoming State IconShopping Cart IconTax Calendar Iconicon_twitteryoutubepauseplay