This blog posts answers to questions given to us by ministers and others serving in Christian ministries advancing the gospel of Jesus Christ. It also discusses other financial topics that those in gospel ministries face. We trust the information provided can be helpful to you.
Search This Blog
Special Topic: A Great Cloud of Witnesses, Introduction to the Series
A Great Cloud of Witnesses
by Corey Pfaffe
The writer of the book of Hebrews followed his Hall of Faith chapter with these words:
Wherefore seeing we also are compassed about with so great a cloud of witnesses, let us lay aside every weight, and the sin which doth so easily beset us, and let us run with patience the race that is set before us, Looking unto Jesus the author and finisher of our faith; who for the joy that was set before him endured the cross, despising the shame, and is set down at the right hand of the throne of God (Hebrews 12.1-2).
Like the first Century Christians, we have our own modern day GreatCloud of Witnesses. They are the men and women upon whose devotion we stand. As 21st Century Christians, these witnesses strengthen and encourage usto fully submit to God’s work in our lives and to respond to the eternal motivation He has placed before us—eternal life with our Heavenly Father in gratitude for the simple uses He made of our earthly days.
Authors of Christian biographies give us a rich trove of enlightenment into the lives of sinners redeemed by the grace of God. God empowered them to live exemplary lives that impacted not only their own generations, but those of countless others to follow. This series of relatively brief summaries seeks to share their stories and to motivate its readers to read and absorb the full pictures painted by the witnesses’ biographers. To begin your journey with us into "the Cloud" click on the Label to the right Cloud of Witnesses.
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…
Can payments made to a health care sharing ministry (e.g., Samaritan Ministries, Christian Healthcare Ministries) which are exempt from the Affordable Care Act be deducted from income as a self-employed (SE) insurance deduction?
First, to be technical, "health care sharing ministries" (IRS exemption D) provide participants an exception from Shared Responsibility Payments (ACA penalties), but don't connote other tax benefits.
Second, a health
care share ministry does not qualify as health insurance. One does not pay what the IRS considers to be premiums, but
instead shares the health expenses of others. And according to IRS Pub 535, in order for self-employed individuals to qualify for a SE insurance deductions they must be to pay
premiums for qualifying health insurance.
Can a church member conduct piano lessons in her church's auditorium without threatening the loss of the congregation's tax-exempt status?
Our answer comes from Matthew Davis, J.D., former attorney with the nationally recognized Christian Law Association, who currently practices law in Wisconsin, Illinois, and Florida.
"As a tax-exempt entity, churches must be careful not only in what activities they engage in directly, but also in how they allow the facilities to be used.
"The primary way in which this can come up relates to the requirement for tax-exempt status that the ministry's activities must relate to its exempt purpose. Assuming the church's exempt purposes are 'religious, charitable, and educational,' (three of the purposes specifically mentioned in the Internal Revenue Code 501(c)(3)), piano lessons would certainly fit within that expectation as 'educational' and therefore not be a problem on the tax-exempt purpose i…