Tax Organizer for Clergy

KEY EXPENSES FOR CLERGY

A   PARSONAGE ALLOWANCE:

Many members of the clergy are paid a cash “housing allowance” which they use to pay the expenses related to their homes (e.g. , interest, real property taxes, utilities, etc.). Alternatively, some may live in a personage owned by the church. Neither a cash allowance (to the extent it is used to pay for home expenses) nor the estimated rental value of the personage is included in income for the purpose of computing your income tax. However, those amounts ARE INCLUDED in your income for the purpose of computing your self-employment (social security) tax, if any. Use this section to record your home expenses and the total annual amount of housing allowance or parsonage value you receive. Because of IRS regulations, it is very important that the governing body of your church designate the portion of your salary that is housing allowance. NOTE: If you have made an election for exemption from self-employment taxes, other rules may apply. In such case, consult with your tax advisor.

B   TELEPHONE EXPENSES:

Toll calls made from your home related to church business are deductible if the expenses aren’t reimbursable to you. To be assured of deduction, clearly mark your monthly phone bill to show the business calls. Since there are special rules for cellular telephones and similar items (called “listed property” in the tax law), it is important to track their business and personal use carefully. Such property potentially qualifies for larger current deductions when it is used more than 50% for business. Keep your bills for the cellular phone and, again, mark business calls.

C   AUTO TRAVEL

Your auto expense is based on the number of qualified business miles you drive. Expenses for travel between business locations or daily transportation expenses in going between your home and temporary work locations (e.g. , from home to hospital call to an ill parishioner) are deductible; include these trips in figuring business miles. However, your trips between home and the office each day or between home and one or more regular places of work are COMMUTING and aren’t deductible.

Document business miles in a record book as follows: (1) Give the date and business purpose of each trip; (2) Note the place to which you traveled; (3) Record the number of business miles; (4) Record your car’s odometer reading at both the beginning and the end of the year. Keep receipts for all car operating expenses-gas, oil, repairs, insurance, etc., and any reimbursement you received for your expenses.

D   TRAVEL – OUT OF TOWN:

Expenses of traveling away from “home” overnight on job-related and continuing-education trips are deductible. Your “home” is generally considered to be the entire city or general area where your principal place of employment is located. Out-of-town expenses include transportation, meals, lodging, tips, and miscellaneous items like laundry, valet, etc.

Document away-from-home expenses by nothing the date, destination, and business purpose of your trip. Record business miles if you drove to your out-of-town location. In addition, keep a detailed record of your expenses-lodging, public transportation, meals etc. Always list meals and lodging separately in your records. Receipts must be retained for each lodging expense. However, if any other business expense is less than $25, a receipt is not necessary if you record all of the information in a diary. You should keep track of all the full amount of meal and entertainment expenses even though only a portion of the amount may be deductible.

E   CONTINUING EDUCATION:

Educational expenses are deductible under either of two conditions: (1) Your employer requires the education in order for you to keep your job or rate of pay; or (2) The education maintains or improves your skills as a member of the clergy. The costs of courses that are taken to meet the minimum requirements of a job or that qualify you for a new trade or business aren’t deductible.

TAX DEDUCTIONS FOR CLERGY

 

PARSONAGE ALLOWANCE Allowance Received   Interest – Home     Taxes – Home     Rent – Home     Repairs – Home     Insurance – Home     Utilities - Home       SUPPLIES & EXPENSES Books – Religious Music   Books – Theology   Business Cards   Insurance - Business   Map Book   Clerical Service   Pager   Telephone – Book   Word Processor   Entertainment (Enter 100% of expense)   Software – Appointment/Calendar   Software – Theological   Software – Word Processing   Greeting Cards   Legal & Professional Services   Photocopy Expense   Postage   Vestments   Vestments – Repair   Vestments - Cleaning   Other:   Other:     TELEPHONE EXPENSES Cellular Calls   FAX Transmissions   Paging Service   Pay Phone   Toll Calls   Other:     MISCELLANEOUS EXPENSES Business & Professional Associations Professional Subscriptions   Other:

 

 

AUTO TRAVEL
Educational
Funerals
Infirm – Hospital Visits
Parishioner Meetings
Out of Town Travel
Outings – Congregation
Weddings
Parking ($)
Tolls ($)
Other:

 

TRAVEL – OUT OF TOWN
Airfare
Bridge & Highway Tolls
Bus & Subway
Car Rental
Laundry
Lodging (do not combine with meals)
Meals (do not combine with lodging)
Parking
Porter, Bell Caption
Taxi
Telephone Calls (including home)
Train
Other:

 

CONTINUING EDUCATION
Correspondence Course Fees
Materials & Supplies
Course Registration
Seminar Fees
Reference Material
Text Books
Photocopy Expense
Other:

 

EQUIPMENT PURCHASES
Answering Machine
Calculator
Copy Machine
FAX Machine
Pager
Telephone
Other: