I am seeing quite a few payroll errors already this year, so I thought it was a good time to go over the top six errors I see when working with a new client's prior payroll.

 

First let me stress that payrolls are difficult to set up correctly in any industry, but when you add the extra burden of making sure a minister is set up and paid correctly... a church's payroll can be especially tricky to set up and administer. 

 

Nonprofit organizations also face challenges when setting up and administering a payroll as there are taxes they are exempt from on a federal level, but not necessarily on a state level.

 

Please take a minute to read the top payroll errors I see when working with new clients...

 

I have seen quite a few post come through my blog lately on housing allowances for ministers. 

 

 

That and the consultations I have been doing this year has made me realize that housing allowances are something that still stumps ministers, church administrators, payroll managers, and even tax professionals.

 

See this post on a minister working at a college: College Paying Minister a Housing Allowance

 

Note 2 important things in that post. First one is that a qualifying ministers with a qualifying housing allowance should not have FICA wages and taxes reported in Box 3, 4, 5, and 6 on their W-2. Second point is that payments on a qualifying "nontaxable" housing allowances should NEVER be reported in Box 1.

 

See more posts on housing allowances and other subjects...