Benevolence Fund

When is a donation from a benevolence fund taxable to the individual recipient?

Comments for Benevolence Fund

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Feb 03, 2015

Benevolence Gifts to Individuals
by: MarcusNtexas

Good question and I don't know the official answer; however, if the recipient performed no services in return for the "gift" then I would think that such gifts would not be taxable until they reached the annual gift limit shown in IRS regulations. Anything exceeding that annual limit could possibly be considered as taxable income to the recipient. In 2015 I believe that limit is $14,000........

Feb 14, 2015

Benevolence Fund = $925.00
by: Sharon

So if a love offering (benevolence fund) was given to an church member=>$600 (instead of directly to the funeral home) then a 1099 is not necessary, correct?

Feb 14, 2015

Benevolence Gifts to Individuals
by: MarcusNtexas

Not sure I understand the connection to the funeral home........

Mar 22, 2020

Benevolent Donation to Help with Rent
by: Bryan from Phoenix

A poor church member can't pay his rent. He asked the church to help.

The church agreed and the church has never assisted him before. The amount is less than $1,000(if that even matters).

Does the church have to give some kind of tax paperwork indicating this is income to the member?

The member did no services in exchange for help and is not an employee of the church and has never received money from the church.

Is the individual required to include this small amount as income even though it went straight to his landlord?

Please help us answer this !
Thank you.
Bryan

Mar 22, 2020

Answer to Benevolent Donation to Help with Rent Question
by: Vickey

Dear Bryan from Phoenix,

No, the benevolence payment for the needy individuals rent is not taxable income to them.

I strongly recommend that you have a benevolence policy in place and that you document and back up the tax free benevolence payment to that individual that shows their inability to pay their rent as shown on my benevolence guideline page:

https://www.freechurchaccounting.com/benevolence-fund.html

Mar 22, 2020

Thank you!
by: Bryan

Thank you so much for the quick response. I was not expecting that anyone monitored this site anymore since it had been so long since someone posted. You have warmed and filled my heart and given me hope today in this situation even as not many churches are meeting across our land.

Jul 01, 2020

1099
by: Anonymous

Im no expert but if you send the funds direct to a landlord or funeral home i think you DO need to send a 1099 to THEM . Might be wrong.

Jul 02, 2020

Benevolence Payments not Taxable
by: Vickey

If it is a proper benevolence payment...it does not matter if paid directly to the individual or business such as a landlord, utility company, or funeral home... it is still not taxable income to that person.

See IRS Pub 3833.

Jul 26, 2020

Funds categories
by: Anonymous

If the pastor brings a check for his Christian association and it is made out to the church but he says it is for him. How do you categorize and does he have to give him 1099 for it?

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If you want to DIY your payroll, I highly recommend you look at using Gusto! It is very user friendly and their support is awesome! Plus they know how to set up and maintain payrolls for churches and nonprofit organizations.

Note: I am a "partner" of Gusto, but as I have told you before ... I never recommend anything that we or our clients have not tried and love =)

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