Understanding Clergy W-2 Forms
The image above details what to expect in different fields of a typical clergy W-2 form. Do you need help with your clergy W-2s? Clergy Financial Services can file W-2 or W-2 correction forms for you. Visit our website at https://www.clergyfinancial.com/services/church-payroll/easy-w-2-filing-is-a-click-away/
FLSA Changes: Updating Your Policies and Practices
Have you reviewed your policies and practices in light of the upcoming overtime changes? Reclassified employees may have to follow procedures and policies that didn’t apply to them before—or that you didn’t have. Changing habits can be a challenge, but changing those of your formerly exempt employees with respect to hours worked and tracked is…
Top Three Clergy W-2 Mistakes
Listing wages or withholdings in Boxes 3 through 6. Clergy are treated like self-employed individuals in regards to Social Security and Medicare taxes. They should not have taxable Social Security or Medicare wages, and they should not have Social Security or Medicare withholdings. Including the Housing or Parsonage allowance in places that it shouldn’t be….
Why are clergy taxes so complex?
There are a number of different reasons for Clergy Taxes being more complex than the average return. First, Clergy are treated differently from every other employee in regards to their compensation. Clergy have a unique “dual status”- they are treated like employees for income tax, and they are treated like independent contractors for Social Security…
Employee Expense Reimbursements
The compliance and financial risks of mishandling employee expense reimbursements have spiked in recent years. And the IRS is in the middle of a wide-ranging audit crackdown on employment-tax issues. Would your books survive an IRS spot-check? Do you know which reimbursements for employee expenses should be treated as expenses … and which as compensation?…
Understanding Clergy W-2 Forms
In many smaller churches, the person in charge of preparing payroll or preparing W-2 forms is not always a payroll expert. They may not understand the complexities of clergy tax law or how compensation should be reported on the form. To help, Clergy Financial Resources has prepared a sample Clergy W-2 for reference, which you…
The Decision: Clergy or Non-Clergy
When a church hires an employee, 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. Ministers have what is commonly referred to as “dual tax status.” For federal…
How Should I Get Reimbursed?
While working for a Church, you may have to pay some expenses out of your own pocket. This could be things like paying for gas while you drive to a distant location, or paying for office supplies, or paying for laundering ceremonial garments. Regardless of the expense, when you get reimbursed by your Church, you…
How to Properly Designate a Housing Allowance
Do you get paid an allowance for housing? Are you sure that it’s set up correctly? Double checking your housing allowance is an easy way to avoid annoying tax headaches later. In order to take a housing allowance, there needs to be proper documentation: A specific dollar amount or percentage of salary must be designated,…
Who Is a Minister?
When a church hires an employee, 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. Ministers have what is commonly referred to as “dual tax status.” For federal…