Turbocharge your 403(b) Savings
In 2019, you can elect to contribute up to $19,000 to your 403(b) account out of your salary. If you are age 50 or older at the end of the year, you can also make a catch-up contribution of $6,000. In total, you could contribute up to $25,000 to your 403(b) account. Why is this…
Deducting Cell Phone Use for Ministry Purposes
Many Ministers use their own cell phone for Church activities. They also use it for personal calls. The big question is determining what you can claim on your return as a work deduction (without getting in trouble with the Internal Revenue Service!). We all know that the IRS is a document-focused agency. If you are…
Documenting Clergy Meal Expenses
As Self-Employed individuals, members of the clergy are allowed to deduct some out-of-pocket ministry expenses on Schedule C or Schedule SE. One expense that many forget to track is the meal expense. If you are meeting others for church-related discussions or activities, you can deduct 50% of the meal costs on your return. If you…
Donating Honoraria to Charity
When working as a Minister for weddings, funerals, baptisms or other speaking engagements, it is common to receive payments as gratitude. The payments for these services are collectively referred to as honoraria. Some Ministers do not wish to receive any money for their service, so they donate the money they receive to the church or…
Five Tips for Claiming Ministry Mileage
For those who do not have a reimbursement plan for mileage, or for those who have some mileage that they pay for out of pocket, here are some quick tips about claiming mileage as a deduction: You cannot deduct normal commuting expenses to and from your main church/regular place of work. If you make a…
Professional Clothing Tax Deductions
Prior to 2018, everyone could potentially claim a deduction on Schedule A for unreimbursed work-specific clothing and laundering expenses. After the Tax Cuts and Jobs Act, most employees lost this deduction, but Clergy can still deduct these costs on their Schedule SE. However, there are still restrictions in place on the deduction. First, the expense…
Do I still need to track Medical Expenses?
In 2018, there were two hurdles to claiming a Medical Expense Deduction. First, you had to spend more than 7.5% of your adjusted gross income on medical expenses. If you had a combined income of $100,000, you would first have to spend $7,500 on medical before you could claim any expenses. And that’s unreimbursed medical…
Claiming Honoraria Expenses
You may not think of payments received from Honoraria, Weddings, Funerals and Pulpit Supply as business income, but that’s exactly how IRS treats them on your tax return. Just like any other business, if you have unreimbursed expenses while doing those activities, you can claim those expenses as deductions and reduce the tax you owe….
Documenting Donations
Charitable donations through your Church or through other non-profit organizations can be a significant portion of your deductions on Schedule A. It’s important to make sure that you are documenting your donations the correct way, otherwise an IRS examination could disallow your deduction! For any donations, whether they are cash or non-cash items, you should…
Donating the Right Way
Many of us donate our hard-earned time and money to charitable organizations and causes, but there is a right way and a wrong way to donate when it comes to your tax return. One mistake is donating to unqualified organizations. While donating directly to individuals can help them quickly, it won’t get you a deduction…
