June 22, 2016
Review your pastor’s Form W-4
We’ve all been victims of good intentions gone wrong, like when a best friend talks you into an unflattering haircut. Or, when your aunt tells you that owning 10 cats is better than just one.
Here’s another: A peer suggests that your pastor can claim 99 dependents on a Form W-4 because that’s how her church “has always done it.” Why do this? The reasoning seems straightforward: a claim of 99 dependents would ensure that a pastor’s pay is not subject to federal income tax.
What’s the harm?
Submitting an accurate Form W-4 is important, so unsurprisingly, an inaccurate claim can have serious consequences. The problem with a pastor declaring 99 dependents is three-fold:
While withholding is optional, it is important to note that pastors are required to pay federal income tax like everyone else. A minister can “opt in” to withholding by voluntarily completing a Form W-4. A set dollar amount or allowance is subtracted from each paycheck to cover annual taxes. The IRS Withholding Calculator can help determine your pastor’s correct withholding allowance. Updating a Form W-4 requires a new form submission—changing or altering an existing form is not allowed.
Do you know a ministry colleague that uses the “99 dependents” practice? We encourage you to forward this article.
Contact a locally licensed attorney to ensure that any changes you want to make comply with your area laws.
For the second year, the Brotherhood Mutual Foundation is offering the Kingdom Advancing Grant to innovative Christian church programs that are transforming local communities through ministry.
With the holiday season right around the corner, it’s wise for ministries to evaluate their fire safety plan. Whether your ministry is hosting a holiday party, prepping treats for charity, or running a community kitchen, make sure you’re well-prepared with these tips.
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Anyone who turns on the news, flips through a magazine, or browses the web can see that American society and culture are experiencing rapid transitions. Some ministries have valid concerns that issues surrounding societal shifts may expose them to negative publicity, governmental scrutiny, or litigation.
Cyber security is increasingly crucial in our technologically advanced world. Scammers use many schemes when attempting to steal your data, but you can outsmart them by understanding their methods.
Most ministry leaders don’t realize there is funding available to non-profit employers including churches, schools, colleges, and camps. This post includes some highlights about the credit and guidance on where to start to see if your ministry is eligible.
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Thieves are taking advantage of soaring precious metal prices. Take steps to protect your ministry’s vehicles and property.
As temperatures plummet, the risk of freezing pipes soars. Frozen pipes can cause costly messes that could also put your ministry on hold while you clean up.
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Learn about the CARES Act and two loans for which ministries may be eligible, since Congress authorized additional funding April 23.
As concern over the dangers associated with the spread of a new coronavirus, COVID-19, spreads, our agency and Brotherhood Mutual want to keep you informed and provide best practices for managing the spread of this and similar illnesses at your ministry.
The first Sunday in February is a big day for sports fans. In fact, many Americans view Super Bowl Sunday as a national holiday. Friends and families will gather this year to watch the big game, enjoy delicious snacks, and of course, critique the commercials that go along with game day.
Recently, we learned about two major overseas incidents involving pastors on mission trips. The first incident involved a pastor being hit by a motorcycle while running. The second was a bus accident involving two pastors. The runner and one of the two bus passengers sustained extensive injuries.
Last month, the IRS announced that its initiating hundreds of church exams to test compliance with the Affordable Care Act (ACA). While many provisions only apply to churches with 50 or more full-time equivalent employees (FTEs), even smaller churches could potentially violate provisions applicable to health benefit plans with as few as 2 plan participants.
July 4th is synonymous with food, fun, and fireworks. If your church is planning an event this Independence Day, remember to keep a focus on safety, so that everyone can have fun.
National Insurance Awareness Day falls on June 28 this year to remind people everywhere that insurance is vital to their companies and ministries.