What is sent to IRS when Pastors only receive love gifts

by Kathy Butler
(Corning, AR)

Church Accounting Package

Church Accounting Package

Question regarding 1099 and love gifts:

After reading through several links on your website, I am understanding that our church needs to give our pastor a 1099 form which has the total of his love gifts received through the year.

Do I include his housing allowance total on this as well?

What form if any does the church have to file to the IRS, concerning this 1099?

We are a small membered church and we are not required to file any 990 or 941 forms. Our pastor does not receive any type of salary, just the love gifts periodically through the year on certain dates, and a weekly housing allowance.

vickey's reply

No, you would not include his housing allowance on a 1099 (there is no place for it). You would simply give him a letter from the church (for the housing allowance...if you are filing a 1099 for the love offerings).

If he was paid $600 or more in regular love offerings, you will need to issue him a 1099-MISC and send the IRS a copy of that 1099MISC and a Form 1096.

Please consider purchasing the Church Accounting Package for more information on handling love offerings and minister's taxes.

Comments for What is sent to IRS when Pastors only receive love gifts

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Feb 11, 2014
Minister told to apply for an ITIN
by: KP

Hi my minister just recently received a 1099 Misc in 2013 from his church. He called IRS and IRS told him he would need to apply for an ITIN# and submit his 1096 with his 1099. Typically this minister files his tax return electronically. I guess the confusing part to me is - why would he need to apply for an ITIN number he has a social security number and the other thing, can he file electronically without completing the 1096 form or will his return no longer qualify for electronic filing.

I thought he would just pick up the 1099 Misc income as self employment wages on a Schedule C and he would file his return electronically as normal.

Thanks so much

Feb 11, 2014
by: Vickey

KP- I am confused too.

The IRS issues ITINs to foreign nationals and others who have federal tax reporting or filing requirements and do not qualify for SSNs.

You said he has a social security number?

Also, it is the church's responsibility to file a 1096...if they were the ones that issued the 1099.

I think your minister may have received some incorrect advice. That is not uncommon for the IRS.

When someone calls the IRS, the person he/she talks to is a Taxpayer Service Representative. In order to be a representative at this level, an agent receives 20 hours of training, and nothing more. No accounting or professional tax background is required. A prominent CPA once conducted a survey by asking IRS representatives 27 "yes or no" questions, and only 6 were answered correctly.

To top it all off...in the court case (David Michael Maser v. Commissioner) the court ruled that if an IRS employee gives you erroneous advice, such advice is generally not binding on the Commissioner...

...taken from this article on StartChurch: Court Says "IRS Allowed to Give You Bad Advice"

Your minister needs to contact a CPA.

Feb 12, 2014
Clergy Tax Rules
by: KP

Thank you so much for responding. I will pass your advice on to my minister. I thought he was given some incorrect information. Thank you again.

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