Examples When No Form 1099-MISC is Required

Question 1:

If an individual is given money (more than $600) as benevolence is a Form 1099-MISC required?

Answer 1:

No Form 1099-MISC is required. In order to receive benevolent gifts no services are required in exchange.

Question 2:

When a member of the church receives financial support for a mission trip that exceeds $600 should a Form 1099-MISC be issued?

Answer 2:

No Form 1099-MISC is required as long as the funds are spend for travel and other costs directly associated with the individuals voluntary ministry-related activities. I recommend that the church maintain documentation of these costs.

If the gifts exceed actual costs, the church should expect excess funds to be returned by the volunteer. Otherwise, it may appear the the individual was not a volunteer and, instead, was being compensated for providing taxable services. In this case, Form 1099-MISC should be issued for the portion of compensation in excess of qualifying ministry-related expenses.

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MinistryCPA - Corey A. Pfaffe, CPA, LLC

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