Volunteering? Don’t forget to keep track of mileage.

You can deduct as a charitable contribution any mileage directly related to the use of your car and unreimbursed out-of-pocket expenses in providing services to a charitable organization. You cannot deduct general repair and maintenance expenses, depreciation, registration fees, or the costs of tires or insurance.  You can use a standard mileage rate of 14…

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Can clergy living in a parsonage receive a parsonage allowance?

Pastors living in parsonages should be provided with a “parsonage allowance.” Even in a parsonage, every pastor has some expense in maintaining his or her home. The amount of the allowance may depend on several factors: whether or not the parsonage is furnished, who provides the upkeep, pays the utilities, etc. When the parsonage allowance…

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Cost of Living Adjustments for Clergy Income

With so many line items making up a clergy’s compensation package, how exactly does one apply a cost of living adjustment (COLA) to their salary package. When a COLA is given to a clergy’s salary, the adjustment is made on their base + housing.  Since housing is a fixed number, the total adjustment is added…

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Is an activity a hobby or a business

Many clergy(and their spouses) participate in activities(outside their main job) that create additional sources of income.  Is it a business or a hobby in the eyes of the IRS? The tax implications of that classification can vary greatly. Below are some questions to ask yourself when trying to determine if an activity is a business…

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Tips for Clergy and their Spouse Who Travel for Charity Work

Do you plan to travel for a church mission trip or other charity work this summer? Some travel expenses may help lower your taxes if you itemize deductions when you file next year. Here are five tax tips Clergy Financial Resources wants you to know about travel while serving a charity. 1. You must volunteer to…

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Do HR rules and regulations keep you up at night?

Hiring new employees is always an exciting milestone in any church, but it can also be overwhelming. We know you are doing the right thing by ensuring tax and payroll accuracy with your payroll. Now it’s time to confirm you are in compliance with the other federal and state regulations. Here are two things you…

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Tips for Dealing with IRS Notices

Tax season has come and gone again and now the IRS is taking a second look at some returns. Even if you’ve already filed a return and received a refund, it is possible that a letter from the IRS could show up in your mailbox. Each year, the IRS sends millions of letters and notices…

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Suffolk County, MA – Automatic Extension

The IRS will issue a notice giving eligible taxpayers until July 15, 2013, to file their 2012 returns and pay any taxes normally due April 15. No filing and payment penalties will be due as long as returns are filed and payments are made by July 15, 2013. By law, interest, currently at the annual…

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Tips for Clergy Who Missed the Tax Deadline

Clergy Financial Resources has some advice for clergy who missed the tax filing deadline. File as soon as possible.  If you owe federal income tax, you should file and pay as soon as you can to minimize any penalty and interest charges. There is no penalty for filing a late return if you are due…

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Health Insurance Payroll Deduction…Taxable or Not?

In order for the payroll reductions for health insurance to be tax-free for employees, the church has to establish a POP (premium only plan) or FSA (flexible spending account) or a cafeteria plan. These benefit plans offer the employee the option to forgo part of his or her compensation on a tax-free basis in order…

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