Wednesday, February 22, 2006
Stewardship E-News for Feb 06
Stewardship E-News February 06
Baptist Resource Network,
Bob Tallent, RGTallent@Comcast.net
Bobbybaptist.blogspot.com www.BRNONLINE.org
856-778-6117 (cell 609-472-4122)
Taxes, taxes, taxes: With the approach of April 15, I am getting calls about tax issues for pastors and churches. The key distinction for the minister’s federal taxes is to remember that he has a dual status. 1) The bona fide minister does not pay Income Tax on his housing cost, but 2) he must pay self-employment tax (at approximately double the rate for Social Security tax) on his entire ministry income. In order to qualify for the housing exemption, the employing entity (“church”) must approve in advance an estimated housing allowance. This can be (and usually should be) larger then what the minister may actually spend because he can exempt everything he spends up to the amount specified. This includes mortgage payments, taxes, insurance, utilities—including even computer on-line service—but not personal long distance, maintenance, fair market rental value of furnishing, cleaning supplies---everything that is required to maintain a “parsonage.” Churches note: by providing this annual document to your minister, you, in effect, give him a substantial raise at no cost to the church. NOW IS THE THIME TO DO THAT FOR NEXT YEAR!
Note that churches should, in some way, acknowledge that their minister must pay much more “Social Security” than the average member. Some churches split out an amount approximating the differential the minister must pay and pays it to him in quarterly payments coinciding with the time the estimated quarterly estimated tax payments are due.
Another key way to reduce the minister’s taxes is to pay ministry expenses on a “re-imbursement” basis rather than a “lump sum”. Any lump sum payment the minister gets are subject to taxation. The little book keeping we have to do is worth the saving of the Lord’s money for ministry.
For detailed information on all of this and much mort, I suggest Worth’s Income Tax Guide for Ministers available at most Christian book stores or online at: www.worthfinancial.com/ .
# # #
Here’s help! How do you handle all of the nettling issues that come up regarding the money and finance in the church? Lifeway has published “A Model Church Financial Policy.” It is available at
http://www.lifeway.com/lwc/files/lwcF_PDF_Hamilton_ModelFinancialPolicy.pdf
Note that not every church needs to institute every aspect of this model, but it is good guide.
# # #
100 percent of U.S. Christians tithing = $156 billion annually If American Christians tithed, churches could gain $156 billion a year, a recent study found. And if denominations allocated a greater percentage of their receipts to international human needs, they could make strides in eliminating poverty-related child deaths, researchers concluded. A recently released study by John and Sylvia Ronsvalle — the latest in an annual series published by empty tomb, a Christian service and research organization based in Illinois — examines giving trends and church priorities. In 2003, members of Christian churches in the United States gave an average of less than 2.6 percent of their income to churches, the researchers discovered. “If church members were to reach a congregation-wide average of 10 percent giving, an additional $156 billion would be available to assist both local and global neighbors in need,” the Ronsvalles wrote. “The potential impact of this money is seen in need statistics that could be addressed in Jesus’ name: $5 billion could help stop the majority of 29,000 deaths a day around the globe among children under five, most of whom are dying from preventable poverty conditions; $7 billion could provide basic education for the world’s children; $124 million could launch a massive world evangelism effort in the ‘10-40 Window’” — an area of global need spiritually and physically. But the long-term trend points to a downturn in individual giving. Overall church members gave a smaller portion of their income in 2003 — 2.59 percent — than in 1968, when members gave an average 3.11 percent. During that same period, churches chose to keep more of the money they received rather than forwarding it to their denominations to support national and international causes, and the 2003 level marked the lowest point in that 35 years. “If the portion of income donated to the church had not declined between 1968 and 2003, congregations and denominations would have had, in aggregate dollars, 72 percent or $2.2 billion more for benevolences, funding the larger mission of the church, than the amount actually donated in 2003,” the Ronsvalles observed. As a part of their study, the Ronsvalles surveyed 28 Protestant denominations. They found — on average — less than 2 cents of every dollar donated to affiliated congregations in 2003 funded the denomination’s international missions programs. They noted in 14 denominations that grew in membership between 1968 and 2003, about 3 cents of every dollar went to denominational global missions. The full report is available at www.emptytomb.org. (ABP)
Baptist Resource Network,
Bob Tallent, RGTallent@Comcast.net
Bobbybaptist.blogspot.com www.BRNONLINE.org
856-778-6117 (cell 609-472-4122)
Taxes, taxes, taxes: With the approach of April 15, I am getting calls about tax issues for pastors and churches. The key distinction for the minister’s federal taxes is to remember that he has a dual status. 1) The bona fide minister does not pay Income Tax on his housing cost, but 2) he must pay self-employment tax (at approximately double the rate for Social Security tax) on his entire ministry income. In order to qualify for the housing exemption, the employing entity (“church”) must approve in advance an estimated housing allowance. This can be (and usually should be) larger then what the minister may actually spend because he can exempt everything he spends up to the amount specified. This includes mortgage payments, taxes, insurance, utilities—including even computer on-line service—but not personal long distance, maintenance, fair market rental value of furnishing, cleaning supplies---everything that is required to maintain a “parsonage.” Churches note: by providing this annual document to your minister, you, in effect, give him a substantial raise at no cost to the church. NOW IS THE THIME TO DO THAT FOR NEXT YEAR!
Note that churches should, in some way, acknowledge that their minister must pay much more “Social Security” than the average member. Some churches split out an amount approximating the differential the minister must pay and pays it to him in quarterly payments coinciding with the time the estimated quarterly estimated tax payments are due.
Another key way to reduce the minister’s taxes is to pay ministry expenses on a “re-imbursement” basis rather than a “lump sum”. Any lump sum payment the minister gets are subject to taxation. The little book keeping we have to do is worth the saving of the Lord’s money for ministry.
For detailed information on all of this and much mort, I suggest Worth’s Income Tax Guide for Ministers available at most Christian book stores or online at: www.worthfinancial.com/ .
# # #
Here’s help! How do you handle all of the nettling issues that come up regarding the money and finance in the church? Lifeway has published “A Model Church Financial Policy.” It is available at
http://www.lifeway.com/lwc/files/lwcF_PDF_Hamilton_ModelFinancialPolicy.pdf
Note that not every church needs to institute every aspect of this model, but it is good guide.
# # #
100 percent of U.S. Christians tithing = $156 billion annually If American Christians tithed, churches could gain $156 billion a year, a recent study found. And if denominations allocated a greater percentage of their receipts to international human needs, they could make strides in eliminating poverty-related child deaths, researchers concluded. A recently released study by John and Sylvia Ronsvalle — the latest in an annual series published by empty tomb, a Christian service and research organization based in Illinois — examines giving trends and church priorities. In 2003, members of Christian churches in the United States gave an average of less than 2.6 percent of their income to churches, the researchers discovered. “If church members were to reach a congregation-wide average of 10 percent giving, an additional $156 billion would be available to assist both local and global neighbors in need,” the Ronsvalles wrote. “The potential impact of this money is seen in need statistics that could be addressed in Jesus’ name: $5 billion could help stop the majority of 29,000 deaths a day around the globe among children under five, most of whom are dying from preventable poverty conditions; $7 billion could provide basic education for the world’s children; $124 million could launch a massive world evangelism effort in the ‘10-40 Window’” — an area of global need spiritually and physically. But the long-term trend points to a downturn in individual giving. Overall church members gave a smaller portion of their income in 2003 — 2.59 percent — than in 1968, when members gave an average 3.11 percent. During that same period, churches chose to keep more of the money they received rather than forwarding it to their denominations to support national and international causes, and the 2003 level marked the lowest point in that 35 years. “If the portion of income donated to the church had not declined between 1968 and 2003, congregations and denominations would have had, in aggregate dollars, 72 percent or $2.2 billion more for benevolences, funding the larger mission of the church, than the amount actually donated in 2003,” the Ronsvalles observed. As a part of their study, the Ronsvalles surveyed 28 Protestant denominations. They found — on average — less than 2 cents of every dollar donated to affiliated congregations in 2003 funded the denomination’s international missions programs. They noted in 14 denominations that grew in membership between 1968 and 2003, about 3 cents of every dollar went to denominational global missions. The full report is available at www.emptytomb.org. (ABP)
# posted by Bob @ 7:43 AM 
