What is the difference between standard and itemized deduction
It’s a good idea for people to find out if they should file using the standard deduction or itemize their deductions. Deductions reduce the amount of taxable income when filing a federal income tax return. In other words, they can reduce the amount of tax someone owes. Individuals should understand they have a choice of…
2019 E-filing Opens January 27th!
For you go-getters and early risers, IRS will start processing 2019 tax returns on January 27th of 2020. There are some valid reasons to delay filing, though. You may not have all of your tax documents yet. You may still be considering contributing more to a retirement account. And some state and federal tax changes…
Hiring Contractors? Get the W-9 Upfront!
Hiring Contractors? Get the W-9 Upfront! Churches that hire contractors have a requirement to obtain their Tax ID Number on form W-9 if they will have to issue a 1099-MISC to them. However, Churches may not know at the beginning of the year if they will pay more than $600 and need to send the…
Who qualifies for “Clergy Status”
The employing congregation, denomination, integral agency of a denomination or a church, or religious organization is responsible to determine whether an individual qualifies as clergy status under the federal law definition. Having “minister” in the title or ministerial duties in a job description is not enough. The IRS uses the five criteria listed below to…
Medical Deduction Threshold Raised to 10% for 2019
Claiming a medical deduction on your 2019 return is going to be even more difficult than on your 2018 return. Previously, taxpayers needed to itemize and spend at least 7.5% of their adjusted gross on unreimbursed medical expenses before they got to deduct anything. Now the threshold has been raised to 10% of your adjusted…
Health Care Penalty Removed, but Premium Tax Credit Still in Play
Before 2019, individuals were required to enroll in qualifying health insurance or they would receive a tax penalty. This was called “minimum essential coverage”. You may remember receiving a 1095 form showing all the months that you had coverage. If you didn’t have insurance or you had an insurance gap, you also might have received…
I received a Lilly Grant, is it taxable?
The Lilly Endowment Clergy Renewal Program provides an opportunities for pastors to step away briefly from the persistent obligations of daily parish life and to engage in a period of renewal and reflection. This grant is up to $50,000, and all or part of the amount received may be tax-free based on the allocation of these funds: Pulpit Supply – Maximum…
Saving Money with an HSA
If you’re looking to save some tax dollars and pay for your medical expenses at the same time, a Health Savings Account is one of the best options currently available. One of the reasons that a Health Savings Account is useful is because of how difficult it can be to get a deduction for medical…
I made a mistake on my 1040 return!
Mistakes can happen on your taxes. Maybe your employer gave you a W-2 that was incorrect. Maybe you forgot to record $500 that you got paid for a wedding last summer. Maybe you accidentally typed 510 as 150 on your notes and underreported income. Regardless of what happened, here are some tips for amending your…
I missed the 1040 extension deadline, now what?
If you extended your 1040 tax return to October 15th and then missed the extension deadline, you may be concerned about what happens to you. If you are due a refund on the return, there is no penalty for missing the deadline. IRS penalties for late filing and late payment do not apply if you…
