A recent Legal Development out of federal tax court highlights the importance of properly handling expense reimbursements for church employees.
In it, a pastor and his wife, though acting in good faith, claimed about $37,000 in unreimbursed business expenses for items such as vehicle mileage, travel expense, business meals.
However, after examination their claim, the IRS disallowed the deductions.
The primary reason? The couple failed to properly substantiate their expenses.
Meanwhile, as Matt Branaugh explains in this short video, churches and church employees can avoid wallet—and heart—breaking scenarios like these through the use of accountable reimbursement plans.
If you’re not up to speed on accountable reimbursement arrangements (which are sometimes also called accountable reimbursement plans), don’t worry, Church Law & Tax members enjoy plenty of access to resources on this topic, including:
For Basic and Advantage Members: Understanding four specific requirements for setting up an accountable reimbursement arrangement.
For Advantage Members: A Q&A with Senior Editorial Advisor, CPA, and attorney Frank Sommerville about how tax reform has affected accountable reimbursement arrangements.
