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Learn the New Requirements Concerning
Cash Offerings
Did you know
that on August 17, 2006 a new law was passed that no longer allows cash
offerings to the church to be tax deductible unless certain requirements
are met.
The Purpose of the W-9
Before a guest speaker ever sets one foot in the pulpit, he/she
should be given a W-9 and it must be completely filled out. If the
church gives the speaker an honorarium larger than $600.00 in one
calendar year, then it must issue him/her a 1099-Misc. If it does not
get a W-9 from the minister, then it must withhold taxes when it gives
the honorarium.
How to Create the Pastor’s
Compensation Package
Private
inurement is when an individual in the church/ministry benefits personally beyond
that which is reasonable. Using a tried and true method, we will show
you how to create a compensation package that is thorough and meets all
due diligence requirements.
The Importance of Bullet Proof
Bylaws
The bylaws of
the church/ministry must be strong. Unfortunately, we live in a sue happy
society. Church lawsuits have gone up %1,600 since 1992 and the
end is nowhere in sight. Your bylaws will either protect you or
hurt you in court. It is important that the correct clauses are in
your bylaws to protect the pastor and the church from being removed from
office in an unjust manner.
The New Requirements of IRC §
7611
The IRS is
now under direct orders to conduct church inquires and examinations of
churches and ministries. The new requirement will give the IRS the
authority to hold the board of directors and pastor/president personally
liable for violations of excess benefit transactions, failure to file
1099 and W-2 forms. All it takes for the IRS to begin the tax
inquiry is for the director of EO Examinations reasonably believes it is
necessary to ensure that the church is in compliance with all of the
sections of the IRS Code, We must be ready and stay ready! |
Learn how section 105b can benefit
the pastor and staff with medical bills
Under section
105b the church can reimburse the pastor for all medical expenses he/she
incurs for himself and all his dependents.
Church/Ministry Administration Simplified
You often
hear that church/ministry and non-profit accounting is harder than any other
type. Using a simple formula, we will show you how to do fund
accounting and always have an accurate and exact record of what is in
each of your church/ministry funds.
When to Issue a W-2 or 1099
One area
where the IRS is going to crack down is in the area of informational
returns. If the church pays the pastor more than $400.00 per year,
then he/she must by law get a W-2. The IRS is going to spend extra
time in the next several years cracking down on failure to issue these
returns. Additionally, pastors who get 1099-Misc instead of a W-2
will significantly increase their chances of an audit.
How to Set Up Pastoral Love Offerings
When an
individual gives a love offering to the pastor, that individual has two
options. If the giver wants the pastor to receive it as a tax free
gift, then the giver cannot get a tax deduction. If the giver
wishes to get a tax deduction, then the pastor must receive it as salary
and report it in his income tax return. Using a tax deferred plan,
the giver can get a tax deduction and the pastor can receive the gift tax
free.
The IRS is Requiring Minutes
A trend has
been gaining momentum in recent months where the IRS has been
requesting complete copies of all the minutes of church board meetings
from its inception in an effort to determine exempt status.
Legal precedent has made that request legal and many churches do not
have any minutes at all. Do not worry, we will teach you how to
correct that.
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