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Do you have to include taxes paid by the church as income for the Pastor?

by Joanne
(Mooresville, In, USA)

Our Church agreed to pay the Pastor's taxes for him. We do not take anything tax wise out of his paycheck.

We do file a 941 though.

Should we not be filing a 941 since it's not taken out of his paycheck and also is the amount that the Church pays for his taxes to be included as income on his W-2?

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Comments for Do you have to include taxes paid by the church as income for the Pastor?

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Oct 10, 2010
 Income tax withheld for Pastor
by: Vickey

If you pay his income tax for him on top of his gross wage, then you will have to include the amount on his W-2.

It would be more beneficial for your pastor if he filled out a W-w and had the church hold out his income taxes and an extra amount that would cover his self employment taxes also.

You would report his withholding on a form 941.
Oct 11, 2010
 Reply
by: Anonymous

Thank you. That's what I thought but I wanted to make sure.
Aug 15, 2012
 Social Security & Med payments
by: Anonymous

If we opt to pay his ss & med do we add this the ss & med tax back to gross pay also.

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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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