Clergy taxes are an extremely narrow niche of tax law, so many generalist tax companies and software packages are not familiar with the rules. On top of this, the Tax Cuts and Jobs Act drastically changed the way that members of the Clergy can claim expenses. If you didn’t file with Clergy Financial Resources, it’s possible that your return includes costly errors.
Here are some important questions to ask about your 2018 return:
- Did you exclude the value of your housing or parsonage allowance when calculating income tax, but add it back in for calculating self-employment taxes?
- If you earned Honoraria payments for things like weddings, funerals, pulpit supply or speaking engagements, did you get to claim unreimbursed expenses or mileage?
- If you earned Honoraria payments, did your return include a Qualified Business Income Deduction, or QBID?
- Did you claim unreimbursed business expenses on Schedule SE as a line item adjustment rather than claiming them on Schedule A?
- If you moved and had your church pay moving expenses for you, did you include these moving expense payments as income?
- Does your return include non-accountable reimbursement plans as income?
You may not know the answers to these questions, but your accounting firm or tax software should. If they don’t, then it is possible that you either underreported income OR you missed some important tax deductions.
Even if you didn’t file your original return with Clergy Financial Resources, we can review your return for accuracy and to determine if an amendment needs to be filed. Visit our website at https://www.clergytaxnet.com/services/clergy-tax-preparation/free-tax-review/ for more details on getting a second opinion today.
Clergy Financial Resources serves as a resource for clients to help analyze the complexity of clergy tax law, church payroll & HR issues. Our professionals are committed to helping clients stay informed about tax news, developments and trends in various specialty areas.
This article is intended to provide readers with guidance in tax matters. The article does not constitute, and should not be treated as professional advice regarding the use of any particular tax technique. Every effort has been made to assure the accuracy of the information. Clergy Financial Resources and the author do not assume responsibility for any individual’s reliance upon the information provided in the article. Readers should independently verify all information before applying it to a particular fact situation, and should independently determine the impact of any particular tax planning technique. If you are seeking legal advice, you are encouraged to consult an attorney.
For more information or if you need additional assistance, please use the contact information below.
Clergy Financial Resources
11214 86th Avenue N.
Maple Grove, MN 55369
Tel: (763) 425-8778
Fax: (888) 876-5101