your church and the irs what you need to know; what you need to do c copyright 2014
TRANSCRIPT
Your Church and the IRS
What You Need to Know;What You Need to Do
cYOUR CHURCH SERIES
Copyright 2014
Year-end IRS Regulations
Why Worry about the IRS?• God’s Word says we are to obey our
government leaders• Witness in the Community• Confidence of our Church Members• Fines• Loss of 501c(3) status• Obey the Law
STEWARDSHIP GOD’S WAY
Year-end IRS Regulations
A NEW IRS form to fill out• 8822-b• Change of Address• State of California has this form in the SI-100
or Statement of Information• DIFFERENCE: IRS wants it annually while CA
wants it every other year• More Penalties with CA form
STEWARDSHIP GOD’S WAY
Have Employees fill out Annually… HSA/HRA/FSA insurance form if
high deductible insurance is offered
Dental form if dental insurance if offered
Salary Reduction form for 401K or 403B retirement plans
Housing Allowance form (ministers only)
Strongly recommend a new W-4
Take Advantage of the New Limits!
About those I-9’s I-9 must be filled out by all employees and
filed separately from employee file All employees (new employees and those
hired since Nov. 6, 1986) must fill out section one of Form I-9 and churches must fill out section two
Do not file Form I-9 with U.S. Immigrations and Customs Enforcement (ICE) or USCIS. Form I-9 must be kept by the employer either for three years after the date of hire or for one year after employment is terminated, whichever is later. The form must be available for inspection by authorized U.S. Government officials (e.g., Department of Homeland Security, Department of Labor, Office of Special Counsel).
Depositing Withheld Taxes
Three types of taxes collected: Income taxes, employee’s FICA, employer’s FICA
Taxes paid monthly if taxes are $50,000 or less in the lookback period
Taxes paid bi-weekly if taxes are more than $50,000
See IRS Publication 15- download a new one
Some computer finance programs compute this for you
Form 941 – A Must Filed Quarterly on the last day of the
month and can be filed electronically Use the 941X if you make a mistake Done even if you only have ministerial
staff Taxes less than $2,500 are sent with
form 944 at year end-be timely in payment:
For 2013: If you estimate your taxes will be less than $1,000 you may contact the IRS and request to use the 944 form. See document.
Unrelated Business Incme
Any income that does not match the purpose of the church
Cell tower income, etc File a 990T Does not apply to churches
renting your facilities to hold church – same type of business
Other Federal Requirements All cash donations less than $250 must be substantiated by either bank record (canceled check) or written communication from the charity
All donations over $250 must be substantiated by written communication from the charity with name of donor on statement
Property over $250 in value must have description
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Other Federal Requirements
Gifts in excess of $5,000 must be appraised by an accredited appraiser and IRS form 8283 must be used to document the gift. Donation is the sale price.
Receipt should not list value of the gift
Donee (church) must keep sufficient records to validate gift-form 8282
Receipt must be given no later than date of donation or tax return due date
W-2 and W-3
W-3 is Transmittal form for W-2’s
W-2’s – Fixing Mistakes W-2c if you make a mistake W-3c if you make a mistake on
the W-3
W-3 Boxes
X X
W-2 Preparation
Ministerial
Form
W-2 Preparation
Non-ministeria
l
Form
IRS form 4361 Regarding Ministers who opted
out of Social Security They can require that you
produce it in the future
They are now doing so Penalties can be severe if you
cannot produce it
1099 MISC Issued to self-employed for income tax or
non employees. Issued if paid more than $600 annually
Not needed for a corporation or for anyone who will receive a W-2 from another employer for work done
Name, address and SS needed before 1099 can be issued. Get the info before payment is made and have them fill out a W-9
1099 is corrected by reissue with the box at the top mark checked
1096 is the Transmittal form for 1099 misc
FULL REPORT
DOWNLO
AD
Additional Helps
Toll free (866) 455-7438 for help with W-2, W-3, 1096, 1099
Order IRS forms from 1-800-829-3676 or http://www.irs.gov/businesses/page/0,,id=23108,00.html
Where Do I Get the Forms? Post office Library IRS – mail Also helpful: All publications to
stay on top of tax laws http://www.irs.gov/app/picklist/list/formsPublications.html
Additional help from GuideStone http://www.guidestone.org/MinistryTools/~/media/GuideStone%20Corporate/Ministry%20Tools/MinTaxGuide/2011/2112_MinistersTaxGuide5.ashx
YEAR END CHECKUP FOR CHURCHES. 15 + PAGES, PLUS A CHECK OFF PAGE
Additional Helps and Information
David Rutledge EA, CEP, RFCRutledge Financial Group
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WHAT QUESTIONS CAN I ANSWER FOR YOU?
(559) 256-0858 direct line(559) 287-7840 cell [email protected]
Rod WiltroutChurch Finance Specialist
www.csbc.com/financialmatters