July 06, 2016

Information Returns to Missionaries: Church vs. Agency

Question:

A church compensated a guest missionary for leading a summer camp event. Must the church issue a Form 1099-MISC to the missionary, his mission agency, or comply with some other directive?

Answer:

If the mission agency with which the missionary is associated receives the funds directly from the church on behalf of the missionary, then it is responsible to issue him the appropriate information return (Form W-2 or Form 1099-MISC). In this case the church does not need to issue the missionary an information return. However, if the compensation is paid directly to the missionary and exceeds $600 on an annual base then the church is responsible to issue Form 1099-MISC to the missionary as an independent contractor. Funds disbursed directly from one 501(c)(3) organization (the church) to another 501(c)(3) organization (the mission agency) are not subject to information return filing. 

For further information on the subject see - 

http://ministrycpa.blogspot.com/2008/12/churchs-issuing-form-1099-misc-to.html

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