Accountable Reimbursement Plan

Georgia SBC has info

The Georgia Baptist Convention just put out some info on the A.R.P.


Heres what they sent just last month. I have used this plan for 1 year and it's not only what the government prefers, but it has helped at tax time.

(Heres what they sent and can also be found at www.churchfinancialservices.org)


2007 STANDARD MILEAGE RATE REACHES RECORD HIGH
WASHINGTON — The Internal Revenue Service released the standard mileage rates to use for
2007 in computing the deductible costs of operating an automobile for business, charitable,
medical or moving expense purposes. Beginning January 1, 2007, the standard mileage rates for
the use of a car (including vans, pickups or panel trucks) will be:
· 48.5 cents a mile for all business miles driven, up from 44.5 cents a mile in 2006;
· 20 cents a mile when computing deductible medical or moving expenses, up from 18
cents a mile in 2006; and
· 14 cents a mile when giving services to a charitable organization.
SAMPLE ACCOUNTABLE REIMBURSEMENT POLICY*
In accordance with IRS regulations 1.162-17 and 1.274-5(e), the ________________ Baptist
Church hereby establishes a reimbursement policy for all ministers and employees with the
following terms and conditions:
1. The church will reimburse only reasonable ministry-related business expenses incurred
by a minister or employee. Subject to budget limitations, such expenses will include:

Business use of automobile, up to the current IRS standard mileage rate;

Business travel away from home: transportation, lodging and meals on overnight
trips;

Convention conference and workshop expenses;

Educational expenses, if otherwise qualified as an itemized deduction and within
IRS limits;

Subscriptions, books, and tapes, if related to ministry or employment;

Entertainment/hospitality expenses, if business connection requirement is met.

Cell phone charges if cell phone is required by the church and not used for
personal use by the minister or employee.
2. The minister or employee will account for each allowable expense in writing at least
every 60 days. Documentation will include the amount, date, place, business purpose and
business relationship of each expense. A receipt will accompany the documentation.
3. The minister or employee will return advances that exceed actual business expenses
within 120 days.
Under this accountable arrangement the church will not report reimbursed amounts as taxable
income on the minister’s or employee’s Form W-2. The minister or employee should not report
reimbursed amounts as income on Form 1040.
If you would like additional information, please contact Church Financial Services of the Georgia Baptist Convention at (770) 936-5295, 1.800.746.4422,
or www.churchfinancialservices.org. If you would like future Tax-Faxes emailed, please send a notice to [email protected]. This document is
intended to provide churches, pastors, and staff with current and accurate information about the subjects covered. However, such information is
not intended to be sufficient for dealing with a particular legal problem, and the authors and distributors do not warrant or represent its suitability
for such purpose. The reader should not rely upon this document as a substitute for independent legal consultation or IRS instructions. *For
additional information contact GuideStone Financial Resources of the SBC, 1.800.262.0511.