Before your first payroll of 2021
Update Employee Income and Deductions The first payroll of the year is the perfect time to review and update your employee deductions, such as: Medical Dental Life Insurance Retirement deductions such as 403(b) Other voluntary deductions You should plan to change retirement deductions based on the new limits for 2021. Limits generally change from year…
Who’s eligible for the second round of Economic Payment?
Generally, if you’re a U.S. citizen or U.S. resident alien, you may be eligible for $600 ($1,200 for a joint return), plus $600 for each qualifying child, if you (and your spouse if filing a joint return) aren’t a dependent of another taxpayer on a 2019 tax return, have a social security number (SSN) valid…
What Does “Personal Use of Church Vehicle” Mean?
Personal use of a church vehicle for non-work-related purposes is a taxable perk known as a de minimis benefit. Personal use of a church vehicle includes: Your employee’s commute between home and work, if it’s on a regular basis. Trips unrelated to your organization’s purpose, work, trade, etc. Use on a vacation or on the…
2021 standard mileage rates decrease
The Internal Revenue Service (IRS) released the 2021 standard mileage rates. Beginning January 1, 2021, the standard mileage rates for the use of a car (vans, pickups or panel trucks) will be: 56 cents per mile for ministry or business miles driven, down from 57.5 cents for 2020 16 cents per mile driven for medical,…
Use caution before making political statements
On July 28th of 2020, the IRS published the following guidance on Churches making political statements. “Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to…
IRS Issues Basic Guidance on Payroll Tax Deferral for Churches
The IRS has issued Notice 2020-65 deferring the withholding and deposit of the employee’s share of Social Security (OASDI) taxes on applicable wages. Specifically, the deferral applies to applicable wages paid on a pay date between September 1, 2020, and December 31, 2020. The availability of deferral is based on the date the employee is paid….
IRS Confirms It Has No Plans To Extend The Filing Deadline
The Department of the Treasury and the Internal Revenue Service have announced that the 2019 tax filing deadline remains July 15, 2020. Due to COVID-19, the original filing deadline and tax payment due date for 2019 was postponed from April 15, 2020, to July 15, 2020. Ministers who cannot meet the July 15 due date…
New Bill – Give Ministers the Opportunity to Opt-in to Social Security
Congressman Kevin McCarthy recently held a press conference with local pastors about his newly introduced bill, the Clergy Act. This bill would offer ministers – many of whom opted out of paying into Social Security in their youth – a two-year “open season” to effectively opt-in to Social Security. McCarthy released the following statement: “In…
Who qualifies for “Clergy Status”
The employing congregation, denomination, integral agency of a denomination or a church, or religious organization is responsible to determine whether an individual qualifies as clergy status under the federal law definition. Having “minister” in the title or ministerial duties in a job description is not enough. The IRS uses the five criteria listed below to…
Freedom from Religion Foundation opts not to appeal
The Freedom from Religion Foundation, or FFRF, has decided not to pursue an additional challenge of the clergy housing allowance at the Supreme Court level. This means that clergy housing and parsonage allowance provisions will likely to remain in place for tax year 2019 and for years beyond. For those unfamiliar with court events, the…