- We have a brief PPT linked on our website with a short comparison among the general three types of accounting. Presentation: Church and Christian Ministry Church Financial Management - http://www.ministrycpa.com/?q=alldownloads
- Other possible resources may be explored on the website sponsored by Church Law & Tax Report http://www.churchlawandtax.com/. Try typing in the search window terms such as "accounting" and "bookkeeping."
A church provides its minister a housing allowance, but for other purposes it believes that it must report the full amount of compensation (including the non-taxable housing allowance portion) on Form 1099-MISC (in order to demonstrate the full earnings of the minister). If the church reports his compensation,including the housing allowance, on Form 1099-MISC as taxable income, will he be able to deduct his housing expenses somewhere else on the Form 1040?
This questions brings up a couple of issues. First, most ministers are properly classified as employees who receive Form W-2, not as independent contractors who receive Form 1099-MISC. On Form W-2, Box 1 for taxable compensation is reduced reflecting the church's designation of a portion of his pay as non-taxable. Then in Box 14, it typically reports as a memorandum item his additional non-taxable, housing allowance compensation. In the situation addressed in the question, this Form W-2 reporting may or may not a…