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.

Oct 07, 2018

Tax Consequences of Volunteer and Staff Gifts

Giving your volunteers and staff gifts can have some dramatic tax consequences. For example, giving a volunteer an appreciation offering can result in a significant "tax event" for the volunteer and the organization!

Continue reading "Tax Consequences of Volunteer and Staff Gifts"

Oct 07, 2018

Restricted Account Balance at Yr End

I have done church bookkeeping over 20 years but this is the first year with a new software. We have several temporary restricted accounts for things

Continue reading "Restricted Account Balance at Yr End"

Oct 07, 2018

Recording the Initial Deposit Acquired via a Loan

Our church has taken out a loan for some building improvements. Obviously, we've recorded the debit to cash and credit to a new Loan Liability account.

Continue reading "Recording the Initial Deposit Acquired via a Loan"

Oct 07, 2018

No house allowance provided

I am helping our pastor do his taxes for 2017. He receives no parsonage or allowance for housing. He owns his house. He has all his house expenses.

Continue reading "No house allowance provided"

Oct 07, 2018

What happened to the $9,000

Using the example - I believe you are saying the cash amount received for the year is $25,000. What happened to the $9,000? It isn't subtracted from

Continue reading "What happened to the $9,000"

Oct 07, 2018

Think twice about hiring CPA

We have found it isn't necessary or favorable to hire a CPA. Their hourly fees are very high because of their expertise especially involving income taxes.

Continue reading "Think twice about hiring CPA"

Sep 18, 2018

Health Sharing Ministries as alternative to health insurance

Our church has opted out of traditional health insurance and instead recommend (not required) that our pastors join a health sharing ministry such as Samaritan

Continue reading "Health Sharing Ministries as alternative to health insurance"

Sep 15, 2018

HA while living with parents to save for downpayment

My husband and I are trying to sell our house to build a new one. We will probably end up living with his parents for six months (rent free) next year

Continue reading "HA while living with parents to save for downpayment "

Sep 08, 2018

Church Accounting Software Reviews

Which church accounting software is best for your church? See what you need to look for in nonprofit accounting software and what other church administrators are saying about their accounting software

Continue reading "Church Accounting Software Reviews"

Sep 08, 2018

Approved 4361, Does the church have to pay the Social Security

If a pastor has an approved 4361 does the church have to pay the Social Security Match? Vickey's Reply: With or without an approved 4361, a church does

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Aug 25, 2018

Using Funds From the Church to Establish Transitional Housing

If the church ceases to operate as a church in its primary mission (lease on building used for church services is running out with no plans to renew) and

Continue reading "Using Funds From the Church to Establish Transitional Housing "

Aug 14, 2018

Are tithes made by church staff tax deductible?

I'm wondering if the tithes I donate to my church would still be eligible for tax deductions if I become an employee of the same church.

Continue reading "Are tithes made by church staff tax deductible?"

Aug 14, 2018

Misclassification of Workers in a Church or Nonprofit

Misclassification of workers is a big issue with many small churches and nonprofits.

Continue reading "Misclassification of Workers in a Church or Nonprofit"

Aug 08, 2018

Hourly employee being paid for hours worked with her husband

We have an hourly custodian employee who would like to have her husband help her clean and be paid for the hours that they both do together. For example

Continue reading "Hourly employee being paid for hours worked with her husband"

Aug 08, 2018

HA for independent or assisted living facility in retirement?

If a retired minister lives in an independent or assisted living facility, can the HA be used to pay for the expense of the facility, since that it is

Continue reading "HA for independent or assisted living facility in retirement?"

Jul 26, 2018

What's the difference between form 4361 and form 4029?

Every I see says to fill out form 4361 to opt out of social security. However this form doesn't say social security, it says Exemption from Self-Employment

Continue reading "What's the difference between form 4361 and form 4029?"

Jul 21, 2018

Missions Trip Contributions

We've recently received contributions for our church's mission trip. For some checks received though, the memo line contains the name of the individual

Continue reading "Missions Trip Contributions"

Jul 21, 2018

Define "reasonable" for a Pastor's salary.

What is considered by the IRS reasonable compensation for a pastors salary? Or can reasonable be whatever a church memer/pastor petsonally feels is appropriate

Continue reading "Define "reasonable" for a Pastor's salary."

Jul 12, 2018

"Gifts that flow from the church ...

I don't want to make any assumptions: 1.Pastor announces a special collection to help his colleague(a visitor to the church) start a new church. Cash

Continue reading ""Gifts that flow from the church ..."

Jul 07, 2018

Tax Cuts and Jobs Act (TCJA) Effect on Churches and Nonprofits

How is the new tax reform laws in the TCJA affecting churches and nonprofits? Read how some of the new laws could require some them to file and pay taxes for the first time.

Continue reading "Tax Cuts and Jobs Act (TCJA) Effect on Churches and Nonprofits"

Jul 07, 2018

Accountable Reimbursement Plan Guidelines

Review the 3 requirements for accountable reimbursement plan reimbursements to be considered accountable.

Continue reading "Accountable Reimbursement Plan Guidelines"

Jul 07, 2018

The hospital I am a chaplain for withheld social security on my housing allowance!

The hospital I am a chaplain for (I am an ordained minister) withheld Social Security on my entire salary, including the housing allowance. The IRS responded

Continue reading "The hospital I am a chaplain for withheld social security on my housing allowance!"

Jun 29, 2018

Still an ordained minister but not employed by the church

My question is if I'm still an ordained minister and registered with the state but no longer employed by a church, can I still receive housing allowance

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Jun 29, 2018

Facilities director AND Campus Pastor

I am interested in learning more about when a pastor is considered a minister as determined by the IRS. I My full-time facilities manager has recently

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Jun 29, 2018

Sending Flowers

under IRS Rules for 501c3 organizations, can a church send flowers to an individual with its fund, whether to a member or nonmember of church? In doing

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Jun 29, 2018

Pastor Payroll Help

I have just started doing the bookeeping for our small church. I am unfamiliar with pastoral payroll. I have three main questions outstanding following

Continue reading "Pastor Payroll Help"

Jun 29, 2018

Accountable Reimbursement Plan

Can this type of plan be set up for a volunteer in the church? Say the Pastors wife?

Continue reading "Accountable Reimbursement Plan"

Jun 17, 2018

Understanding Financial Statements for a Church

Preparing and understanding financial statements for a church or nonprofit.

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Jun 03, 2018

W2 Box 1 negative when including Housing Allowance and Retirement Contribution

My denomination allots a housing allowance of 75% of gross income, for which I can fully utilize by making additional house payments toward the mortgage

Continue reading "W2 Box 1 negative when including Housing Allowance and Retirement Contribution"

Jun 01, 2018

Compensation Package with Prepaid Debit Card

Can you tell me if there are any stipulations to offering a prepaid debit card for an allotted amount of hospitality to a church employee as part of their

Continue reading "Compensation Package with Prepaid Debit Card "



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