Independent Minister to Employed Minister

by Tina
(Springdale, AR, USA)

We had a youth minister try out last summer. He came twice to preach. The church paid a total of $500.00 for his service. A few months later, he decided this is where he was called to minister. So, he became an employee at that time. I have a W2 prepared for the duration as an employee. My questions are: 1) Do I send him a 1099 for the $500? I realize normally you only do it if $600+. I'm not sure if that rule applies since he is now an employee.


Comments for Independent Minister to Employed Minister

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Jan 17, 2013
guest speaker became employee
by: Anonymous

the money would be added as income on his W-2 box 1.

Jan 17, 2013
Consult a Tax Professional
by: Vickey

You need to consult a tax professional on this question.

I would think that it would be easier for him just to add it to his W-2 instead of having to claim it as self-employed income...BUT he wasn't official hired at the time and was in fact considered an independent contractor...and if he was considered an independent contractor and was paid under $600, then he would be the one responsible of reporting that income to the IRS...not the church.

BUT since this is an unusual situation, you should either call the IRS and hope you get someone who knows what they are talking about...or bite the bullet and get paid professional advice.

P.S. it is a VERY busy time for CPAs and you might not get an answer before you have to issue the W-2 on the 31st but here is some CPAs on the web you could submit your question to:

Corey Pfaffe, CPA:

Bill OConnell:

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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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