Nonprofit and Church Accounting Blog

This accounting blog...

  • informs you when any new web pages appear on my site,
  • shows you the latest question, comment, or tip posted by readers...(please feel free to browse the questions below and answer the ones you feel comfortable answering),
  • let's you know when an error is found in my free financial spreadsheets and how to correct them.

May 08, 2020

State Sales Tax - LA

Louisiana does not exempt churches from sales tax. Sales tax not collected at time of purchase on items used in the operation of the church such as bibles,

Continue reading "State Sales Tax - LA"

May 05, 2020

Accounting for PPP Funds

Bookkeeping for PPP funds for churches

Continue reading "Accounting for PPP Funds "

May 03, 2020

Housing Allowance in year of retirement.

My housing allowance of $25,000 for 2020 was adopted by the Board in December 2019. I will be retiring on July 31. Can I claim on my 2020 tax return

Continue reading "Housing Allowance in year of retirement."

May 03, 2020

Housing Allowance and the 941 Form

We do not provide a salary for our pastor, only a weekly $200.00 housing allowance. Should we include this amount on the 941 Quarterly form?

Continue reading "Housing Allowance and the 941 Form"

May 03, 2020

How to handle voluntary Fed and State tax withholding for pastors with 100% salary as housing allowance

I am the treasurer for a small church. We have 2 employees, both pastors, who have elected to be employees for tax reporting purposes. Due to their housing

Continue reading "How to handle voluntary Fed and State tax withholding for pastors with 100% salary as housing allowance"

Apr 22, 2020

Pastor Employed with HA & recieving retirement with designated HA ???

Can a minister who is 69 and presently an employee of his church and receiving a housing allowance also use a housing allowance designated by his retirement

Continue reading "Pastor Employed with HA & recieving retirement with designated HA ???"

Apr 22, 2020

Down Payment on New home & Housing Allowance

When a pastor moves to a new church and buys a new home, does the down payment on a new home factor into minister’s housing allowance?

Continue reading "Down Payment on New home & Housing Allowance"

Apr 22, 2020

When to report FMV of church owned property for minister

We have a new minister joining our staff. The plan is for he and his wife to use dual living space - their primary home and a church owned property - until

Continue reading "When to report FMV of church owned property for minister"

Apr 22, 2020

Question concerning how church organist is paid

As pastor, I have just become aware that we are paying our church organist by sending her pay to her landlord for a partial on her rent. A lawyer that

Continue reading "Question concerning how church organist is paid"

Apr 22, 2020

Unemployment compensation

As independent contractor, organist, now that churches are closed during pandemic. Can I collect unemployment?

Continue reading "Unemployment compensation"

Apr 22, 2020

Designated Accounts

Our church borrowed money for a building. Debit Bank / Credit Note Payable This makes my bank balance but ... How do I get the money into the designated

Continue reading "Designated Accounts"

Apr 22, 2020

Part Time Youth Minister - Full Time Secular Job

Our youth minister is part time. We have been treating him as an employee withholding SS, State tax, and Fed Tax. He has a full time secular job where

Continue reading "Part Time Youth Minister - Full Time Secular Job"

Apr 22, 2020

Tax return software that will accept a clergy W2 with box 1 empty

For a minister working part-time and all of his salary is designated housing allowance, what software program will accept a clergy W2 with box 1 empty?

Continue reading "Tax return software that will accept a clergy W2 with box 1 empty"

Apr 22, 2020

Can a church give a contribution receipt for a website name that is donated?

There is a website name that the church would like to buy (the church initials.com), but it is for sale for $45,000. If the church paid $100, could we

Continue reading "Can a church give a contribution receipt for a website name that is donated?"

Mar 22, 2020

Downpayment on new home

Can a minister who is currently renting while in between having sold their home and purchasing a new one use the down payment made in the purchase of their

Continue reading "Downpayment on new home"

Mar 22, 2020

Love Offering/Pastor's Aide for Elderly Retired Pastor

We give a monthly offering to our founding pastor who is elderly and does not file taxes. We describe this offering as pastor's aide. I understand

Continue reading "Love Offering/Pastor's Aide for Elderly Retired Pastor"

Mar 09, 2020

Love Offering during musical performance

I am a member of a musical group considering holding a concert at a local church. The group is a 501c3 nonprofit. If the church collects a free will

Continue reading "Love Offering during musical performance"

Mar 09, 2020

Receiving Social security benefits for secular employment while working as a minister

I have worked a secular job 20 years before becoming a minister if I file 4361 will I still be able to receive the benefits paid into social security

Continue reading "Receiving Social security benefits for secular employment while working as a minister"

Mar 09, 2020

Ushers making change from the offering plate

I was recently told that, from the loose tithes/offerings in the offering plate, our ushers have been making change for people who do not have the exact

Continue reading "Ushers making change from the offering plate"

Feb 21, 2020

Top 5 Church Payroll Mistakes

Church payroll mistakes can be costly. Learn what to do and what not to do!

Continue reading "Top 5 Church Payroll Mistakes"

Feb 05, 2020

W3 reporting form for Pastors W2

if a pastor opts out of FICA, what does the church check on kind of filer on the W3. The church doesn't file a 941 or 944 report because there is nothing

Continue reading "W3 reporting form for Pastors W2"

Feb 05, 2020

Clergy retirement plan

The company pays for our Pastor's retirement plan, do I check the retirement box or leave blank?

Continue reading "Clergy retirement plan"

Feb 05, 2020

How Do We Report Insufficient Salary?

We approved our Full-time Senior Pastor for a $36K 2019 Compensation package: $18K Salary/$18K HA but the church could only afford to pay him a little

Continue reading "How Do We Report Insufficient Salary?"

Feb 05, 2020

Pastors Housing Allowance Annual Designation

If the housing allowance remains the same each year does it have to be recertified each year ?

Continue reading "Pastors Housing Allowance Annual Designation"

Feb 05, 2020

Can an ordained minister not receiving income from a ministry still claim housing allowance

My husband is an ordained ministry with a full-time non-ministry job, and also has a ministry to incarcerated inmates. He performs ministry part-time

Continue reading "Can an ordained minister not receiving income from a ministry still claim housing allowance"

Feb 05, 2020

housing allowance is more than pastor earned this year

our pastors wages for 2019 were 21,250.00, his housing allowance is 24,000.00. how do I show this on hisw2?

Continue reading "housing allowance is more than pastor earned this year"

Feb 05, 2020

Accounting software for small non-profit group

I am considering purchasing an accounting software for my non-profit group. Our monthly transactions are between 5 - 15 entries per month. What do you

Continue reading "Accounting software for small non-profit group"

Feb 05, 2020

Paying half of ministers health insurance deductible...taxable?

we as a church pay half of ministers $2500 medical insurance deductible. This is not done through the insurance company it is part of our agreement with

Continue reading "Paying half of ministers health insurance deductible...taxable?"

Jan 20, 2020

Can you buy a desktop version of Aplos and if so, what is the cost?

Can you purchase Aplos church software in a desktop version and if so, how much is it and does it come with any support?

Continue reading "Can you buy a desktop version of Aplos and if so, what is the cost?"

Jan 19, 2020

Is it illegal in the state of TN for a church to pay its bills with cash?

I recently tried paying the church I serve as pastor’s bill at the local Christian bookstore and was told it was against the law in Tennessee for a church

Continue reading "Is it illegal in the state of TN for a church to pay its bills with cash?"



Need training on how to use QBO or Aplos effectively for a church or better yet ...need an expert in either of those accounting software to do your monthly bookkeeping and/or payroll? See more on our accounting services!