November 28, 2012

Church Members Carrying Money to Foreign Mission Agency

Question:

Members of a local church recently went on a mission trip. Part of the purpose of their trip was to carry a sum of cash to a foreign mission agency for use in its mission. This amount was donated by the home church of the members. The individuals paid for their own expenses so that the entire donated amount was given to the mission agency for use in the field. Does the church need to issue Form 1099’s to the individuals?

Answer:

No, the church does not need to issue Form 1099-MISC’s to the individuals since the church, in effect, donated the money to another tax exempt organization. However, the church should receive documentation from the mission acknowledging receipt of the money. This ensures that all of the money was used by the foreign mission agency, and not by the individuals to cover travel expenses.

Some ministries provide cash to volunteers for foreign travel. Careful documentation of personal travel, local transportation, meals and lodging expenses must be required of these volunteers. Further, any excess funds must be returned to the church. Without these two conditions, the amounts represent taxable income, and would then need to be reported on a Form 1099-MISC.

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