A church office administrator should handle reimbursement for clergy through an accountable reimbursement plan. Here are the key steps to follow:

1. Establish a Written Policy: Create a written expense reimbursement policy that outlines which expenses are eligible for reimbursement. This policy should include ministry-related expenses such as travel, office supplies, religious materials, meals, and professional dues.

2. Expense Documentation: Clergy must provide receipts or other documentation to substantiate their expenses. This documentation should include the amount, date, place, and business purpose of each expense.

3. Approval Process: Ensure that all expenses are approved by the appropriate supervisor before reimbursement. This helps maintain accountability and ensures that only eligible expenses are reimbursed.

4. Reimbursement Submission: Clergy should submit their expenses on a monthly expense report. This report should include all necessary documentation and be reviewed by the church office administrator.

5. Tax Compliance: Ensure that the reimbursement plan complies with IRS guidelines. Under an accountable plan, reimbursed expenses are not considered taxable income for the clergy.

By following these steps, the church office administrator can effectively manage reimbursements for clergy and ensure compliance with tax regulations.

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Clergy Financial Resources serves as a resource for clients to help analyze the complexity of clergy tax law, church payroll & HR issues. Our professionals are committed to helping clients stay informed about tax news, developments and trends in various specialty areas.

This article is intended to provide readers with guidance in tax matters. The article does not constitute, and should not be treated as professional advice regarding the use of any particular tax technique. Every effort has been made to assure the accuracy of the information. Clergy Financial Resources and the author do not assume responsibility for any individual’s reliance upon the information provided in the article. Readers should independently verify all information before applying it to a particular fact situation, and should independently determine the impact of any particular tax planning technique. If you are seeking legal advice, you are encouraged to consult an attorney.

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