Should churches withold Fed tax...

[Salty]

This subject was brought up on another thread.

Several years ago, the govt took possession of a church building to pay back federal withholding taxes. The church stated that it should not be required to withhold taxes for Church employees.

http://www.papillonsartpalace.com/p...ted to pay tax debtBaptist Temple tax dispute

Do you agree or disagree?

Other thoughts

Salty

 

[Pastor Larry]

All employers are required to withhold federal taxes. Churches are no different.

 

[LeBuick]

I didn't know this. No taxes are with held from my support check but I do file and pay at the end of the year..

 

[Salty]

I didn't know this. No taxes are with held from my support check but I do file and pay at the end of the year..

If you are a pastor, it is beacuse the govt considers you an independent contractor. That also means you pay the full social security and medicad.
(in an employer-employee relationship, the employer pays 1/2 of FICA and Medicade)

Salty

 

[PK]

It all depends on if you think that God's house should be run like a buisness or not? Is Jesus the Lord of the New Testament Church or is president of the 501c3?

 

[Pastor Larry]

Pastors are not generally considered independent contractors by the IRS, though it can be complicated. The legal definition of an employee includes the pastor.

If your church considers you an independent contractor and does not withhold taxes, they could be liable not only for taxes not withheld, but also for penalties.

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html
http://www.elca.org/treasurer/congregations/relationship.html
http://www.allbusiness.com/personal-finance/individual-taxes-tax-deductions/698801-1.html

 

[Pastor Larry]

It all depends on if you think that God's house should be run like a buisness or not? Is Jesus the Lord of the New Testament Church or is president of the 501c3?

Actually, it depends on whether or not you think Romans 13 is the command of God or an option that we can reject at our own discretion. Withholding taxes for clergy in no way compromises the lordship of Christ over the church. It rather demonstrates it, since our Lord commanded us to obey the government. If we refuse to withhold taxes appropriately, we have rejected the Lordship of Christ.

 

[PK]

Actually, it depends on whether or not you think Romans 13 is the command of God or an option that we can reject at our own discretion. Withholding taxes for clergy in no way compromises the lordship of Christ over the church. It rather demonstrates it, since our Lord commanded us to obey the government. If we refuse to withhold taxes appropriately, we have rejected the Lordship of Christ.

I do not disagree with your statement in part. We (citizens) should pay taxes but not the church. I know, "Render unto Ceaser what is Ceaser's and to God what is God's", but when confronted with this question himself, Jesus did not tell Judas to pay out of the money bag but to go and get it out of the fishes mouth.

 

[tinytim]

Witholding taxes through the year would help the pastor when it came time to file... He may even get a return...

I trust H&R Block to do ours... I would go crazy if I didn't!!!

 

[Pastor Larry]

We (citizens) should pay taxes but not the church. I know, "Render unto Ceaser what is Ceaser's and to God what is God's", but when confronted with this question himself, Jesus did not tell Judas to pay out of the money bag but to go and get it out of the fishes mouth.

The church is not paying taxes. The church is withholding taxes from the individual, and mailing them in on his behalf. It is how the government runs until tax time.

Even with withholding, I still have to pay quarterly taxes in addition to what I have already paid through withholding.

 

[LeBuick]

Witholding taxes through the year would help the pastor when it came time to file... He may even get a return...

I trust H&R Block to do ours... I would go crazy if I didn't!!!

I think I will inquire about this because I have to save every year just to make the Apr 15th deadline. I've even had to file extentions because having to pay Fed, SS, Medicaid/care etc... It's tough...

Does H&R charge much for this advise?

 

[Salty]

I think I will inquire about this because I have to save every year just to make the Apr 15th deadline. I've even had to file extentions because having to pay Fed, SS, Medicaid/care etc... It's tough...
quote]

The extenstin is only for filing - not for paying the tax. If you dont pay by Apr 15th, then you must pay late charges and interest.

 

[Pastor Larry]

The extenstin is only for filing - not for paying the tax. If you dont pay by Apr 15th, then you must pay late charges and interest.

Not only that, but if your church doesn't withhold, and you dont' pay estimated tax, or if your church doesn't withhold enough and you don't make it up through estimated tax payments each quarter you will be charged interest and penalties.

 

[tinytim]

I think I will inquire about this because I have to save every year just to make the Apr 15th deadline. I've even had to file extentions because having to pay Fed, SS, Medicaid/care etc... It's tough...

Does H&R charge much for this advise?

Honestly, I can't quote you a price... they take it out of my refund.
I was taking my business to an accountant that only charged $35 to work up my taxes... but I couldn't get the instant refund... plus we moved half a state away!! lol
I have been blessed enough to not have to pay... because of the Earned income credit has always been enough to offset the taxes I owe...

But I am dreading the yr all my kids turn 18...
Not only will I have to pay taxes but college tuition as well!!!

Even so, come Lord Jesus come... QUICKLY!!!!

 

[annsni]

Honestly, I can't quote you a price... they take it out of my refund.
I was taking my business to an accountant that only charged $35 to work up my taxes... but I couldn't get the instant refund... plus we moved half a state away!! lol
I have been blessed enough to not have to pay... because of the Earned income credit has always been enough to offset the taxes I owe...

But I am dreading the yr all my kids turn 18...
Not only will I have to pay taxes but college tuition as well!!!

Even so, come Lord Jesus come... QUICKLY!!!!

LOL - We're at this point in life Tim and it's NOT fun.

Our church does the withholding and now as DH being a full time pastor with 4 kids, we get it all back at the end of the year. LOL! It's a nice bonus to help pay off the home equity line of credit.

 

[tinytim]

Some churches give the Pastor a Social Security Offset... a little extra that is designated to help pay his taxes...
I am not sure how it works, or if it is taxable... I think it is.. .but I remember one church gave the pastor I think it was $2500 to offset his taxes...

 

[rbell]

Some churches give the Pastor a Social Security Offset... a little extra that is designated to help pay his taxes...
I am not sure how it works, or if it is taxable... I think it is.. .but I remember one church gave the pastor I think it was $2500 to offset his taxes...

That is taxable $$.