Clergy Housing Lands in Seventh Circuit
Churches and the IRS joined forces Wednesday before a sympathetic Seventh Circuit panel to argue that a 65-year-old income tax housing exemption for clergy members does not violate the Constitution’s Equal Protection Clause. “The court has to take history into account,” said attorney Luke Goodrich of the nonprofit law firm Becket, a public-interest firm representing…
New Changes to the Employee Business Expense Deduction
Prior to the Tax Cuts and Jobs Act, which went into effect, January 1, 2018, unreimbursed ministry-related expenses were generally deductible on the minister’s individual tax return as a miscellaneous itemized deduction (Schedule A) if they exceeded 2% of an individual’s AGI. Starting in 2018, these deductions will be eliminated for tax years through 2025. This includes unreimbursed…
IRS Increases Annual Gifts Tax Exclusion
For starters, you can give gifts valued up to the annual gift tax exclusion amount each year without ever touching the lifetime exemption. For 2017, the exclusion was $14,000 per recipient. In 2018, it increased to $15,000 per recipient. The federal gift tax applies to the giver of a gift, not the recipient, for amounts…
Does your Church Want to Pay Tax on Employer Parking?
Churches and other historically tax-exempt organizations may need to file federal and likely state income tax returns according to a recently unearthed provision in the newly instituted Tax Cuts and Jobs Act that applies the federal income tax to parking benefits. Hundreds of organizations are now calling for its repeal. Section 512(a) (7) addresses this new…
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…
Giving Strategies to Charity Under New Tax Law
Changes to the tax law in 2018 have taken away most people’s ability to deduct charitable contributions. But there are still a few options to consider in order to give and still receive. Fortunately, there are options for donors who would like to obtain a tax benefit for their generosity. One permits anyone 70½ or…
The New Tax Form Is Postcard-Size, but More Complicated Than Ever
IRS Dumps Proposal to Ask Charities for SSNs of Donors
The Internal Revenue Service has dropped a proposed regulation giving tax-exempt organizations the option of providing the Social Security Numbers of their donors. The rule, which the IRS and the Treasury Department proposed last September, called on charities to ask for additional personal donor information, including Social Security numbers for any donation of $250 or…
2016 Tax Season Will Begin On February 1st.
Clergy Financial Resources will begin accepting and e-filing individual returns on February 1, 2016. We will also begin processing paper tax returns at the same time. We look forward to opening the 2016 tax season. Our employees have been working hard helping clergy all year to get ready for this filing season. The filing deadline to submit 2015 tax returns is…
2016 Standard Mileage Rates
Optional standard mileage rates for ministry and business use of a vehicle will go down in 2016, the IRS announced on Thursday (Notice 2016-1). For ministry and business use of a car, van, pickup truck, or panel truck, the rate for 2016 will be 54 cents per mile, compared with 57.5 cents in 2015. Driving…