Finance records are the property of the local church. Recommended record retention

New special tax law for Haiti Relief contributions

IRS has LOWERED the mileage rate again for 2010 – click here for additional information.

File the required IRS NP-20 form annually no later than THE 15th day of the 5th month following the end of the tax year. What does this mean??? The due date is dependent on the local church year-end. If the church year-end is December, the form is due May 15. (See below for other tax guidance.)

Questions about Pastor Salaries and Taxes?

The best source for information is IRS Publication 517.

Pastors are considered self-employed, yet their earnings are reported on a W-2 form.

Self Employment tax (often referred to as Social Security) is calculated on salary plus housing allowance or fair rental value of the parsonage. Click here for additional information using the IRS “Regular Method”.

When preparing the W-2 form, we highly recommend that the following wording be printed in Box 14 of the W-2 form…

Ø Taxpayer is a Minister NOT subj to FICA tax or W/H requirements

Also the “Retirement Plan” box in box 13 is to be marked if the pastor is participating in the FMCNA pension plan.

Tax forms and publications are FREE at www.irs.gov or by calling 1-800-TAX-FORM (829-3676) For further W-2 guidance, click here

Here are a few additional tax sources that you might be interested in. 

These are available through Zondervan or your local religious bookseller

· Worth’s Income Tax Guide for Ministers

· Minister's Tax & Financial Guide by Dan Busby

· Church and Nonprofit Tax & Financial Guide by Dan Busby

Guidelines for Wabash Conference local church obligations. See our Forms page for additional information

Each local church of the Wabash Conference falls under FMCNA for 501(c)(3) NFP status and is to acquire and maintain its own federal ID number and any payroll tax withholding account numbers. See http://www.irs.gov/ for federal guidelines and your state’s web site for state guidelines.

Never assume that a church is automatically exempt from tax!

Each local church is responsible for their own sales tax exemption certificate AND personal property tax filings with the state.

Indiana state property tax requirements are governed by each township. Contact your Township Assessor to see they require annual filing.

Exemption applications are not automatic and may be required every leap year. Again, check with your local government office.

Illinois state law still requires yearly renewal of property tax exemption. Click Here for more information.

West Virginia check with your government agency for local requirements

Note also that IRS requires all earnings over $600 paid by an organization (the local church) to any LLC or individual (that is not incorporated) be reported on a 1099-MISC. A W-9 should be acquired from these individuals.

If you have any question, please contact our office.