What Is Self-Employment Tax?
When a church hires a worker, one of the initial decisions that must be made is whether to treat the worker as a minister, non-minister employee or contractor. This decision may seem insignificant, but it has huge implications when it comes to payroll. Ministers have what is commonly referred to as “dual tax status.” For…
Can a church offer a Health FSA without a medical plan?
If the church has a group health plan, you may want to consider a Health Flexible Spending Account (FSA). A health flexible spending account (FSA) is a type of tax-advantaged medical account that reimburses employees for eligible health care expenses that are not covered by their health plans. Both employees and employers can contribute to a…
How to Value Noncash Charitable Contributions
If you donate property to a nonprofit such as clothing, electronics, books, or furniture, you need to determine how much it is worth when you donate it. The basic rule is that you may deduct no more than the property’s “fair market value” at the time of the donation. But fair market value can be…
How to Survive an IRS Audit
An IRS audit can be a very frustrating process. With that said, it is important to understand that it is nothing personal. In other words, it is not as if this particular IRS agent singled you out and decided he or she wanted to audit you. Therefore, try to stay calm and keep in mind…
Strategic Management of Vacation Requests
You want to support employees by providing the opportunity for work/life harmony, but you also have a church to run. Sometimes it is difficult to juggle multiple vacation requests around popular vacation times, especially during the summer months and other holiday times throughout the year. Below we have provided a few tips, suggestions and best…
Advantages of a Premium Only Plan
If your employees pay a portion of their group insurance premiums, you may be able to reduce your payroll taxes, and give workers a little extra in their checks each and every payroll, by setting up premium only plan (POP) through payroll deductions for their share of insurance premiums. The Section 125 POP program is a…
Is it Vacation or Paid Time Off?
Traditionally, churches had offered separate paid time off benefits to employees, such as paid vacation, sick leave and personal days. However, in the past decade, many churches have moved to a more flexible Paid Time Off or “PTO” benefit that incorporates all policies into one all-inclusive PTO plan. The debate as to whether churches benefit…
2018 Brings Change to 529 College Savings Plans
The Tax Cuts and Jobs Act, which was signed into law in December 2017, allows families to use 529 plans to pay for up to $10,000 in tuition expenses at elementary or secondary public, private or parochial schools. The changes became effective January 1, 2018. 529 plans offer tax-free earnings growth and tax-free withdrawals when the…
When do I use Form W-9?
When a church hires a worker, one of the initial decisions that must be made is whether to treat the worker as clergy, non-clergy employee or contractor. This decision may seem insignificant, but it has huge implications when it comes to payroll. When you hire a new employee, you need to fill out paperwork to…
What To Do If You Get a Notice From the IRS
Every year, the IRS sends millions of letters and notices to taxpayers for various reasons. There are many different types of notices issued by the IRS — depending on the notice you receive, you may have a range of options for responding. If you have not filed an income tax return for at least one year, the…
