Are Gift Certificates to Church Staff Taxable?
Are Gift Certificates to Church Staff Taxable? When churches want to express appreciation to their pastors or staff—especially around holidays or ministry milestones—gift certificates often seem like a simple, generous solution. However, under U.S. tax law, gift certificates given by a church to its employees are almost always taxable, regardless of intent. Understanding why requires…
How to Select the Right Clergy Tax Preparer
How to Select the Right Clergy Tax Preparer Clergy face some of the most complex tax situations of any profession. Dual tax status, housing allowances, self‑employment rules, parsonage issues, and ministry‑related reimbursements all require specialized knowledge—knowledge that many general tax preparers simply don’t have. Choosing the right professional isn’t just about filing on time; it’s…
When Are W‑2 and 1099 Forms Required to Be Filed.
When Are W‑2 and 1099 Forms Required to Be Filed Churches function as employers, contractors, and ministry organizations—but despite their nonprofit status, they are not exempt from federal payroll reporting laws. The IRS requires churches to properly classify workers and file W‑2 and 1099‑NEC forms each year, just like any other employer. Failing to follow…
IRS issues guidance for Trump accounts
Trump accounts are a new type of education savings vehicle created under the One Big Beautiful Bill Act (OBBBA). These accounts are intended to help families save for qualified education expenses and are subject to specific statutory and regulatory rules. The IRS has issued preliminary guidance on Trump accounts in Notice 2025‑68, which outlines initial…
Fourth Quarter Estimated Tax Payment
The final estimated tax payment for the 2025 tax year is due on January 15, 2026. This deadline applies to clergy and represents the fourth and final quarterly estimated payment for the year. Why Estimated Taxes Exist The U.S. tax system is a pay‑as‑you‑go system. The IRS expects taxes to be paid as income is earned,…
Tax Season Scams: How to Avoid Identity Theft and Tax Scams
As we begin a new year, tax season is quickly approaching—and unfortunately, it’s also a peak time for criminal activity. During tax season, scammers and identity thieves increase their efforts to trick individuals into sharing sensitive personal and financial information, such as Social Security numbers, dates of birth, and tax records. With this information, criminals…
2026 Mileage Rates Announced
If you use your personal vehicle for ministry, business, charitable work, medical appointments, or certain moving situations, you may qualify for a mileage deduction on your tax return. The IRS allows taxpayers to deduct vehicle expenses when the driving is directly connected to specific qualifying purposes, and mileage is often the simplest way to calculate…
Understanding 529 Plan Withdrawals
How 529 Withdrawals Work Before you withdraw anything, you must verify that the expense meets IRS rules for qualified education expenses. These include: Tuition & mandatory fees At any accredited college, university, trade school, or graduate program. Room & board Student must be enrolled at least half-time. Books, supplies: You can withdraw up to the…
2025 Year-End Tax Strategies
Year‑End Tax Strategies: A Practical Checklist As the end of December approaches, here are key tax‑saving moves to review and complete before year‑end. Make Charitable Contributions Individuals may generally deduct charitable gifts up to 50% of their adjusted gross income. Donate unused household items or clothing to qualified charities; keep receipts, canceled checks, and any…
2026 Housing Guide Now Available
The Housing Allowance Exclusion permits clergy to set aside a portion of their compensation specifically for housing expenses, shielding that amount from federal income tax. By reducing taxable income, clergy can significantly lower their overall tax burden. Although this exclusion is one of the most valuable tax advantages available to ministers, it is also one…
