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Review: Form 1099 Payments to 501(c)(3) Organizations

Question:

A church rented space from another church last year. Should it request a completed Form W-9 and issue Form 1099-MISC?

Answer:

We have written similar blog posts on this topic in the past (listed below), but we figured it was a good time for a review. 

Payments from one 501(c)(3) organization to another 501(c)(3) organization are not subject to Form 1099-MISC reporting. The 2015 Instructions for Form 1099-MISC state that "payments to a tax-exempt organization" are exempt from reporting a Form 1099-MISC. 

The following are typical examples of payments of $600 or more by a church which are subject to reporting a Form 1099-MISC:
  • Rent paid to an individual (non-corporation)
  • Payments for services rendered by individuals who are not employees (e.g. janitorial service, facilities, snow removal, guest speakers)
  • Support sent directly to missionaries
Here are some similar blog posts that we have written in the past:

Form 1099 for Payments to Other Ministries
Form 1099 for Non-profit?
Form 1099-MISC Rental Payment Reminders
Churches Issuing Form 1099-MISC to Landlords


Comments

  1. Our faith-based university 501(c)(3), received a 1099-Misc Form from a corporation who paid us royalties. Is there anything we need to do with this form?

    ReplyDelete
  2. In the process of preparing the university's annual Form 990 (Return of Organization Exempt From Income Tax), the school's preparer must report all income within appropriate classifications. The presence or absence of Form 1099-MISC will have no bearing on this classification.

    ReplyDelete

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