Money Given to the Minister from the Service Collection Plate

by Rowena Roby
(Elizabeth City, NC)

If we give the pastor 500.00 a Sunday from the collection plate and he pays taxes from another income, will it cost him more taxes this way rather than have the church write him a check and pay taxes on the funds paid to him?

vickey's reply
No matter which way you do it, it would be taxable income to him.

Check your state and federal labor laws to see if your pastor would be considered an employee of your church. Most of the time, a pastor is considered an employee of the church.

If so, see the section on setting up a payroll on this site on the proper steps to take to report and pay his salary. See this page for an example of a Pastor's W-2.

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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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