Determining Worker Classifications
Exempt or Non-exempt? Classifying exempt and non-exempt church employees is just as crucial as distinguishing between independent contractors and employees. Generally, this involves a straightforward separation between salaried (exempt) and hourly (non-exempt) employees, but that is not the only criterion. Organizations must adhere to the Fair Labor Standards Act (FLSA) guidelines to determine the classification…
Fines for Mismatched TIN and Name?
Did you know that submitting a mismatched Taxpayer Identification Number (TIN) and name combination can result in fines? If a mismatched name/TIN combination is submitted on your W-2 or 1099 filings, the IRS will issue a CP21000 or CP2100A Notice if the payee’s name and TIN do not match IRS records. This notice indicates that…
Is there still time to claim employee retention credits?
Is there still time to claim employee retention credits for our church? Yes! The first expiration date for the credits is April 15, 2024, for any 2020 credits. 2021 credits can be claimed through April 15, 2025. That said, the IRS is still taking 6-12 months to process most credits, so the cash is not…
Can I limit W-4 changes?
Can I limit the number of times an employee makes changes to their W-4? No. IRS guidance states that an employee has the right to make changes to their Form W-4 as often as they would like, and you, as the employer, need to make those changes, even if they’re frequent. The only exceptions are…
What if we pay one employee the wrong amount?
What if we pay one employee the wrong amount? Can we wait to pay the difference on their next check? Don’t wait. If the employee was underpaid, it is in your best interest to pay the employee the difference immediately. Wages are due on the regular payday for the pay period covered, as required by…
W-4 Instructions for Clergy
The W-4 form contains five steps. Not every step is applicable to every employee, so some sections might correctly remain blank. Step 1. Here, clergy and nonclergy would provides personal information. Make sure the name, address, and social security number entered match what Payroll has on file. This section also asks filing status: single or…
Three Common Church Payroll Mistakes
Three Common Church Payroll Mistakes Payroll and taxes are usually a confusing topic for churches that can easily find themselves in trouble with the IRS if payroll taxes are not reported correctly. For churches, payroll taxes can be especially tricky due to the dual-tax status of their pastoral staff. There is a widespread misunderstanding among…
ICHRA Reporting Requirements
ICHRA Reporting Requirements Individual Coverage Health Reimbursement Arrangements (ICHRAs) first became available in 2021. ICHRAs allow employers to reimburse employees for individual health insurance coverage (or Medicare coverage) that employees obtain on their own. ICHRAs provide employers with an alternative to offering traditional group health insurance coverage to employees. Although ICHRAs may not be a…
Online W-2 and 1099 Filing for Churches
Start Filing W-2 and 1099 Forms today! Online W-2 and 1099 Filing for Churches The W-2 Form is probably one of the most common tax forms used by churches today, as every employee must receive one prior to filing their income taxes out and every employer must produce them. The mere mention of filing a…
W-2 vs. 1099: Which workers get which?
W-2 vs. 1099: Which workers get which? As the economy continues to expand, churches now more than ever need to possess a thorough understanding of the classification for each person performing services for the church. Knowing whether the IRS views someone as your employee or as an independent contractor dictates tax obligations and associated paperwork,…
