Missionary's W-2 From Sending Church When No Agency is Involved

Question:

A church sends a missionary acting as his mission agency. This role makes the church an employer subject to Form W-2 filing. A treasurer of such a church was told that a missionary's Form W-2 should only report the money given to him minus his on-field expenses. Alternatively, it seemed to him that the church should simply report what the missionary was given. Then he should report his deductions when he files his tax return. What should be done?

Answer:

The answers to questions 4 and 5 in the accompanying link discuss and illustrate the treasurer's situation. The bottom line? Without an accountable plan in place the full compensation should be reported in Box 1 of the Form W-2. With a properly administered accountable plan, the payments should be omitted.

For more, follow this link: Top 10 Questions Pastors Ask Tax Preparers

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MinistryCPA - Corey A. Pfaffe, CPA, LLC

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