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Christmas Bonus

by Donna
(Macon)

We gave our pastor a small Christmas Bonus.

My question, is all of the bonus taxable income and nothing from it goes into his Housing Allowance? I'm trying to get an early start of the 4th quarter 941 form.

Comments for Christmas Bonus

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Jan 01, 2020
 Christmas Bonus Taxable Income
by: Vickey

Yes, the Christmas bonus would be taxable income and should be included with their wages on the quarterly 941 form and subsequently reported in Box 1 of their W-2.

No part of it should be considered part of his housing allowance.

A housing allowance is payments for maintaining a minister's house and is excludable from personal income taxes.

A bonus is an "appreciation" gift and the IRS considers it payment for service...so is taxable for income taxes AND SECA taxes.

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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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