TAX FAQ:

Individual Income Tax

What are the requirements to receive a ministerial housing allowance?
One of the most misunderstood topics as it relates to ministerial compensation is the housing allowance. We take the time with each client, based on their previous year’s housing allowance and future expectations, to strategize on how to maximize the benefit of housing allowance.

Do you offer tax planning?
Yes. Ministers (and other church employees) have a variety of tax advantages not available to everyone. All too often, these advantages go unused. We believe that a minister’s best strategy for tax planning is to be well educated. Knowing what is available in regards to tax savings is the first step in tax planning.

At what time am I considered self-employed as a minister?
There seems to be a lot of misunderstanding when it comes to self-employment. The day that a minister becomes licensed, commissioned or ordained, the IRS requires that they be treated as self-employed for Social Security and Medicare tax purposes (collectively known as “SECA” tax). This means that the church can no longer withhold and remit either of these taxes on the minister’s behalf. The minister must pay self-employment tax on all earnings from the church (including housing allowance) when filing their individual tax return, unless he has formally filed IRS Form 4361 to opt out.

Do you prepare corporate tax returns?
We often find that a minister will set up an LLC or corporation to properly run their various business ventures and it can be beneficial to have the same tax preparer handle both their personal and corporate returns.

We have experience with partnership (Form 1065), S-Corp (Form 1120S) and C-Corp tax (Form 1120) returns.

IRS Form 990 FAQ’s

What if our organization has never filed an IRS Form 990?
If you were not aware of the filing requirements (or simply have never filed a Form 990), we are happy to assist you in filing delinquent tax returns and to assist with any attempts to re-instate the tax exempt status of the organization if tax exempt status has been revoked.

What is included on the informational return?
While content is determined upon the type of return that your organization must file, you should be prepared and understand that there are a few major pieces of information that will be disclosed publicly on the Form 990 and its related schedules:

  • Name and compensation for your board of directors, officers, and other key employees
  • Financial statements
  • Tax exempt purpose of the organization

What is the filing date for informational returns?
The filing due depends on your organization’s fiscal year. If you operate on a calendar-year basis, your due date is May 15th of the year following the end of the filing year. Otherwise, the return is due on the 15th day of the 5th month following your fiscal year-end.

What states can you file informational returns for?
We are happy to assist with the filing of your federal informational return and any state forms required by law.