Wages report on w-2

by Tina
(USA)

Have more questions? Our How To Guide can help!

I am a pastor of a small congregation that is paid 4000.00 yearly.

For 2015 1000.00 was reported as wage each quarter as income on 941 quarterly & state withholding and I elected to have federal and state taxes withheld.

Also at the beginning of the year the board designated the 4000.00 as housing allowance, when filing my taxes I received a w-2 with 1000.00 in box 2 as income is this correct?

Vickey's Reply
No. There are several items of concern in your post. First of all, a housing allowance is not reported on the quarterly 941s. See this page on How to Prepare a Quarterly Form 941

If your compensation was reported on line 2, it is considered taxable compensation and should be reported in Box 1 on your W-2.

Any federal income tax withheld from your compensation will be reported in Box 2 on your W-2.

If all your income was approved as a housing allowance then your quarterly 941s and W-2 all need to be amended.

I advise you to hire a Tax or CPA Firm familiar with churches and ministers such as the firm I work for: Wisdom Over Wealth to amend and straighten out your compensation reporting.