MinistryCPA - Corey A. Pfaffe, CPA, LLC

Question: A church would like to award a scholarship to a young person attending a Christian College. Should the check be made payable to the student or the institution? Answer: The check should be made payable to the institution . We recommend that additional information be communicated to the institution including the name of the student and a note related to the scholarship with wording such as: "The accompanying check is awarded to a student of the University or College as a scholarship subject to Internal Revenue Service filing instructions for Form 1098-T as cited here: Form 1098-T, Box 5  'Scholarships and grants generally include all payments received from 3rd parties (excluding family members and loan proceeds). This includes payments received from governmental and private entities such as the Department of Veterans Affairs, the Department of Defense, civic, and religious organizations, and nonprofit entities.' " Here's the problem:   A chec...

Question: Can a church with an active employee 65 years of age drop the employee's health coverage in favor of assisting the Medicare eligible employee with Medicare premiums? Answer: "The Age Discrimination in Employment Act (ADEA) which is administered by the Equal Employment Opportunity Commission requires employers of 20 or more employees to offer to their age 65 or over employees and to the age 65 or over spouses of employees of any age, the same coverage, and under the same conditions, as they offer to employees and employees" spouses under age 65." (https://secure.ssa.gov/poms.nsf/lnx/0600620177) The following source addresses employer reimbursements of Medicare premiums: "In general, when an employee (or his or her spouse) is eligible for Medicare due to age, an employer may reimburse his or her Medicare premiums only when: 1 The employer’s group health plan is a secondary payer to Medicare because the employer has fewer than 20 employees; AND 2...