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Happy New Year!
Now is the time to review the Pastor's compensation package. Each year many clergy miss out on special tax benefits that the IRS offers only to ministers. Some items to consider are:
Housing Allowance - This is one of the most important tax savings available to ministers. It is also one of the least understood. Section 107 of the Internal Revenue Code allows "ministers of the gospel" to exclude some or all of their ministerial income-as designated by their church-as a housing allowance from income for federal income tax purposes. This amount must be designated in advance.
Accountable Expense Reimbursable Plans - Expenses for clergy supplies, books, robes, dues, travel, seminars and conferences and other ministry costs can be excluded from income if set up properly for reimbursement from the church.
Fringe Benefits -
- Health insurance
- Medical reimbursement plans
- Educational assistance
- Retirement plans
In order to qualify for these benefits, you must be licensed, commissioned or ordained. This includes not only the Pastors but other ministers who teach, sing and carry out administrative functions.
Let us help you plan and structure your compensation package for maximum tax savings.
For more information, call us at (404)793-0303 or toll-free at (866)306-8003.
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