Church Health Reimbursement Arrangement (QSEHRA)

A qualified small employer (one that employs fewer than 50 full-time (including full-time equivalent) employees, and does not offer a group health plan to any of its employees) may offer a QSEHRA to its employees for the payment or reimbursement of eligible medical expenses (including individual insurance policy premiums) on a pre-tax basis. The QSEHRA…

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Getting a Second Opinion

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…

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Top Ten Tips for 1040s

Here are ten tips to avoid errors when filing your 1040 returns. Math and typing errors- Using tax software or a tax firm to prepare your return greatly reduces the chances of mathematical errors, but it is still easy to transpose digits while doing data entry. Even if you have someone prepare your return, check…

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Crowdfunding

Crowdfunding is a relatively new way to gather donations from others for things like mission trips. Well known examples of crowdfunding websites include “Gofundme”, “Kickstarter” and “Patreon”. Since it is so new, there is not a lot of official IRS guidance on the subject. According to an IRS letter published in 2016 (which you can…

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What is a Social Security Allowance?

If you are a member of the Clergy, you may have seen the phrase “Social Security Allowance” on your W-2 or it might be a part of your compensation package. But what does that mean exactly? To understand, we have to explain a difference between Clergy and Non-Clergy employees. Non-clergy employees have Social Security and…

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Can we classify our musicians as a contractor?

Most churches often struggle with “employee classification” usually with their musicians, nursery workers, secretaries, custodians, etc.  Generally, the IRS looks at three areas: Behavioral Control, Financial Control, and Type of Relationship. In most cases, church musicians do not pass the test of being an independent contractor because of the control that the employer exercises over…

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Change of Address? Notify the IRS.

If you’ve moved or you are planning on moving, don’t forget to update your mailing address with the Internal Revenue Service. Normally, IRS just mails correspondence to the last address you listed on your last 1040 return, but if you’ve moved since then and your forwarding order with the post office has expired, you could…

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Travel Deductions for Ministry Work

When you’re travelling for Ministry work, it’s easy to become so busy that you forget to keep track of your expenses. Here are five quick tips for claiming travel expenses for your tax return. 1. There are lots of different unreimbursed expenses that Clergy can claim on their taxes. The most common expenses include airfare,…

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When does the I-9 need to be completed?

All new employees must complete Section 1 of Form I-9 on or before their first day of employment. Then, within three business days of their start date, they should submit acceptable proof of their identity and eligibility to work in the United States.  As the church, you should complete Section 2 within those same three…

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Five Quick Facts about Gift Tax

Gift tax is paid by the giver, not the recipient. If Uncle Bill decides to give you $20,000, you do not need to pay any tax on it. It would be Bill’s responsibility to report that gift to the Federal Government and to pay the taxes. In 2019, the annual exclusion limit is $15,000. This…

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