Clergy Tax Facts
Overview
The most important point to remember is that last year's 11th-hour tax changes, though favorable for most, are temporary. After 2012, many provisions are set to snap back to what they were before 2001, and a few even expire this year.
2011 TAX LAW HIGHLIGHTS
PERSONAL EXEMPTION:
• Each personal or dependent exemption is worth $3,700.
STANDARD DEDUCTION:
• $11,600 for married couples filing a joint return, and qualifying widows and widowers.
• $5,800 for singles and married individuals filing separate returns.
• $8,500 for heads of household.
• Taxpayers who are 65 or older or who are blind may be eligible for a higher standard deduction.
ALTERNATIVE MINIMUM TAX THRESHOLD:
• $74,450 for a married couple filing a joint return, and qualifying widows and widowers.
• $48,450 for singles and heads of household.
• $37,225 for married individuals filing separately.
Income tax brackets:
• 10%, 15%, 25%, 28%, 33%, 35%.
EARNED INCOME TAX CREDIT:
To qualify income can be no greater than:
• $43,998 ($49,078 married filing jointly) with three or more qualifying children
• $40,964 ($46,044 married filing jointly) with two qualifying children
• $36,052 ($41,132 married filing jointly) with one qualifying child
• $13,660 ($18,740 married filing jointly) with no qualifying children
Maximum credit:
• $5,751 with three or more qualifying children
• $5,112 with two qualifying children
• $3,094 with one qualifying child
• $464 with no qualifying children
CAPITAL GAINS:
• 0% if taxed in the 10% or 15% brackets.
• Top rate of 15% if taxed in higher brackets.
STANDARD MILEAGE RATES:
Ministry/Business use
• 51 cents a mile, Jan 1-June 30, 2011
• 55.5 cents a mile, July 1-Dec. 31, 2011
Medical reasons or qualified move
• 19 cents a mile, Jan 1-June 30, 2011
• 23.5 cents a mile, July 1-Dec. 31, 2011
Charitable purposes
• 14 cents a mile
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Get a better understanding of U.S. tax laws as they relate to pastors and churches with the Church & Clergy Tax Guide |
Every church and its employees want to feel confident that their compensation plan is reasonable and fair. |
To accomplish your church's mission and vision for ministry you need to effectively manage your church's finances |
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Clergy should not view this information as a substitute for professional advice. This information is subject to change, due to administrative rulings or interpretations and or technical corrections by the IRS. If legal advice or other expert assistance is required, the services of a competent clergy tax professional person should be sought.
