2025 Standard Mileage Rates
The standard mileage rate for transportation or travel expenses for 2025 is 70 cents per mile, up from 67 cents in 2024 for all miles related to your ministry or business. The standard mileage rate for charitable use is 14 cents per mile. The standard mileage rate for medical care or as part of a…
Charitable Contribution Substantiation Guidelines
To substantiate charitable contributions, taxpayers must adhere to specific requirements based on the type and amount of the contribution. Here are the detailed substantiation requirements: General Requirements for All Contributions Cash Contributions: Cancelled Check: A cancelled check can serve as proof. Receipt from Donee: A receipt showing the name of the donee, the date, and…
Defining a minister’s tax home related to travel deductions?
The IRS defines a taxpayer’s “tax home” for travel deductions under IRC § 162(a) as the taxpayer’s regular or principal place of business. If the taxpayer has no regular or principal place of business, the tax home is considered the taxpayer’s regular place of abode in a real and substantial sense. This definition is crucial for determining…
Understanding Clergy Dual Tax Status
Clergy are defined as dual status because they are treated differently for various tax purposes under the Internal Revenue Code (IRC) and Treasury Regulations. Specifically, clergy members are considered self-employed for Social Security and Medicare taxes under the Self-Employment Contributions Act (SECA). Still, they can be regarded as employees for income tax purposes. This dual…
Can a church rent space to a for profit business?
Renting to a profit-oriented business by a church is categorized as an unrelated business activity, which is not directly aligned with the purpose of the organization’s exempt status. Such activities must be reported on Federal Form 990-T and will be subject to tax. However, certain expenses can be allocated to reduce the income, including utilities,…
Why are clergy subject to Self-employment tax
Clergy are subject to self-employment tax because their earnings from ministerial services are considered self-employment income under the Self-Employment Contributions Act (SECA). This classification is based on several key provisions and interpretations of the Internal Revenue Code and related regulations. Definition of Net Earnings from Self-Employment: According to § 1402(a) of the Internal Revenue Code, “net earnings…
Donation of public traded securities
To facilitate the donation of publicly traded securities to your church, the process involves several steps to ensure compliance with IRS regulations and maximize the donors’ tax benefits. Here’s a guide on how to handle such a donation: Establish a Brokerage Account for the Church Open an Account: The church should set up a brokerage…
2024 Mileage Rate Announced
IR-2023-239, Dec. 14, 2023 WASHINGTON — The Internal Revenue Service issued the 2024 optional standard mileage rates to calculate the deductible costs of operating an automobile for business, charitable, medical, or moving purposes. Beginning on Jan. 1, 2024, the standard mileage rates for the use of a car (also vans, pickups, or panel trucks) will…
Non-deductible ministry meals & travel?
Non-deductible ministry meals & travel? Generally speaking, a deductible ministry expense must be “ordinary and necessary” for it to count as a write-off. Ordinary and necessary simply means it’s a common expense for someone in the ministry, and it’s essential for the operation of your church. Unfortunately, you can’t deduct all the food that you…
What is mileage reimbursement?
What is mileage reimbursement? Mileage reimbursement is the reimbursement you receive for using a personal vehicle for ministry purposes. The reimbursement covers all costs of owning and driving your vehicle for the qualified miles. The IRS mileage reimbursement covers the use of specific vehicles, namely: cars, vans, pickups, and panel trucks. Mileage reimbursement is normally…
