Q&A: Does Our Pastor Have to Report This Payment as Income?

One couple in our church wanted to get married out of state. They paid our

One couple in our church wanted to get married out of state. They paid our pastor to officiate the wedding, but the payment wasn’t enough to cover his travel expenses. Does he have to report the payment as income? What about his travel expenses?
If the fees are paid by the church, they should be reported by the church as additional income to the pastor. However, if the fees are paid by the members themselves (which seems to be the case here), then the fees ordinarily should be reported by the pastor as self-employment earnings on Schedule C (Form 1040). Expenses incurred in performing personal services directly for members—such as the pastor’s travel expenses—can be reimbursed by the church under an accountable reimbursement arrangement, or, if they are not reimbursed, they can be deducted by the pastor on Schedule C if the pastor has sufficient evidence to substantiate the amount, date, location, and business purpose of the expenses.

Adapted from “Fees Received Directly from Member.”

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

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