MinistryCPA - Corey A. Pfaffe, CPA, LLC

Question: Do batteries qualify as a housing allowance expense? Answer: The expenditure for batteries, if meeting the following general guidelines for use in connection with the pastor's personal residence, may meet the requirements. Although there are not likely court cases or Revenue Rulings citing the exact examples offered here. In a June 2016 post, we shared the following: "A minister’s housing allowance benefit is non-taxable income to the extent that the allowance is used for housing expenses. The three-part test includes consideration of the fair rental value of the home, plus actual costs of utilities (see this blog post regarding the three-part test). In addition, the expenses must be incurredrelative to the minister’s principal residence. According to Federal Tax Regulations, Regulation, §1.107-1, Internal Revenue Service, Rental Value of Parsonages, only food and servants are specifically excluded." If, for example, the batteries are for a smoke ala...

Question: A church would like to "gift" 10% of the sale price of the parsonage to a pastor towards his retirement. Is the pastor going to be subject to income tax on that gift? Is it taxable if put into an IRA on his behalf? Answer: Whether the gift is paid is paid to him directly or through contributions to his Traditional IRA, the “gift” will be taxable and reportable on Form W-2, Box 1. Internal Revenue Code section 102(c) clearly states that gifts given to employees by their employers are taxable compensation. The IRS has consistently applied this provision to self-employed (non-employee) individuals who provide services for an organization as well. Only the facts and circumstances surrounding a gift can determine whether IRC section 102(c) does or does not apply; a letter stating that a payment is a gift will not override the substance of a transaction ( 2008 Blog ). Having said this, the church may wish to consider other alternative means. For example, cooperation wit...

William Carey: The Father of Modern Missions by S. Pearce Carey, 1923, The Wakeman Trust, London, ISBN 978-1-870855-61-7 Follow link for an Introduction to the Cloud of Witnesses series S. Pearce Carey, William Carey’s great grandson, offers a family perspective on the brilliant mind and consecrated life of one who first left England to reach to the regions beyond with the Gospel of Jesus Christ.  From the historical setting of his birth on August 17, 1761, to the legacy he left in the land of India and upon the world following his death on June 9, 1834, Carey’s life story leaves its reader with a sense of enablement to attempt great things for God. For William Carey once said, Expect great things from God. Attempt great things for God. Source: https://edhird.files.wordpress.com/2013/05/william-careymap.jpg It was 32 years before Carey left England never to return. He was motivated by the lives and stories of such men as Captain John Cook, explorer of the isl...