Many churches pay little attention to the concept of “reasonable compensation”. Nonprofit organizations, of which churches make up by far the largest percentage, must serve public interests not private. As a result, an individual should not receive assets from a nonprofit entity simply because they have a significant relationship with the charity. If this happens, […]
The AICPA CPA Letter Daily reported that companies that receive payments from credit cards or third-party settlement agencies may have to keep an eye out for 1099-K forms this year. These forms will be sent to businesses that receive more than $20,000 in gross payments from at least 200 transactions annually. Companies that receive both […]
That’s right! Even though churches normally do not have to file a tax return (most nonprofits have to file an informational return annually – IRS form 990), there is certain information that you must collect and provide to the IRS. And I’m not talking about payroll tax information – 941 and W-2 forms. If you […]
I have a friend who has reminded me to be thankful for annoying things such as the red light I am stopped at, because I am privileged enough to live in a country that has roads, and orderly ones at that. This same attitude can be applied to taxes—thankfulness for them and for the ability […]
Does your church have 25 or fewer full time employees? If so, the government wants to give you some money. The recently passed health care bill included a tax credit for small businesses that provide health insurance for their employees. Although churches do not typically file income tax returns, they are still eligible for the tax credit. […]
Some churches give pastors (or other employees) monthly expense allowances in their paycheck. The allowances provide a way to advance cash to employees so that they can purchase items needed for the church or to carry out their role within the church. There are two important things to keep in mind if your church does this. […]
Great news for the small nonprofits. The filing threshold has finally increased from $25,000 in gross receipts to $50,000 in gross receipts for tax years ending on or after December 31, 2010. This means if the nonprofit’s gross receipts are normally $50,000 or less you can file the simple 990-N e-postcard as opposed to the […]
The Tax Relief, Unemployement Insurance Reauthorization & Job Creation Act that was signed into Law in December 2010 has made changes to the way you calculate your social security deductions on your employee paychecks for 2011. Social Security tax rates will be reduced by two percentage points. The employee-portion of Social Security taxes will be […]
Millions of small employers received postcards from the IRS last Spring that alerted them to the new small business health care tax credit and encouraged them to check their eligibility. Perhaps your church did not receive this notice because it does not file a tax return. Even if you didn’t receive a postcard, your church […]
Tax exempt organizations are required to file an annual return with the IRS. If the organization fails to do so for three consecutive years, the exempt organization automatically loses its exempt status. The IRS announced today one-time relief benefits for Form 990-N and Form 990-EZ filers that have failed to file for the previous three years. […]