IS YOUR CHURCH PAYING THESE COSTS NEEDLESSLY?
Most Churches do not have a huge “war chest” to pay for everything they feel God has called them to do. By the same token, the average Church in the USA consists of 70 members. These average Churches usually have very small staff and often feel pressured into unneeded monetary expenses that further strain the already limited Church budget. Whatever you do, do not misclassify your employees.
In many secular work environments, the hallways and bulletin boards are filled with posters and ads promoting a safe work place. However, the Church is hardly a hazardous work environment. It is hard to imagine a Pastor or Treasurer injuring their backs by picking up a stack of offering envelopes. Yet, many Churches, especially smaller congregations are billed needlessly for some Worker’s Compensation Insurance Premiums.
Chitwood and Chitwood discovered an often over-charged and unnecessary premium expense by Worker’s Compensation Insurance Companies that push Churches into obtaining coverage for all of their workers, including Church Officers and Board Members. With the exception of California, States do not require Church Officers and Board Members to be included in the Worker’s Compensation premium.
Also, many states do not require Worker’s Compensation if there are less than three employees. Whether a Church should obtain Worker’s Compensation if the staff is less than three is a decision that each Church and Board should prayerfully consider.
The Pastor of the Church is considered as President of the organization. How many Pastors are likely to hurt themselves on the job to such a degree they could not fulfill their Pastoral functions? Another question to consider is how many Pastors, if they were on Worker’s Compensation, could survive financially on a Compensation payment of $385.00 per week?
Local CPAs who have no clue as to what really is required in Church finances have cost Churches millions of dollars because of incorrect or partially correct advice. This is why all Churches should outsource to the Number One Church and Clergy Accounting Firm in the world – Chitwood and Chitwood.
The State Unemployment Tax Act (SUTA) was created to assist out of work employees. This tax must be paid by employers and has been used excessively, especially in the past several years.
As with the Churches and Worker’s Compensation, Chitwood and Chitwood discovered thousands of Churches, over the past several years, which had been incorrectly advised by local, uninformed CPAs, to pay a tax of which they were exempt.
Local CPAs that are not proficient in Church Tax Law have frequently improperly processed Church payrolls that has resulted in Churches paying State Unemployment Taxes from which they were exempt.
The same is true with the Federal Unemployment Tax Act (FUTA). When a Church payroll has been misclassified, the FUTA and the SUTA are often needlessly assessed to unsuspecting Churches who have placed their trust in a local CPA that does not know Church Tax and Law.
Local CPAs are great people and most do a great job for for-profit corporations and small businesses. However, they have cost Churches a lot of money over the years. Many Churches and Pastors who have had battles with the IRS, had a local CPA who told them the Church books were okay.
Is a local CPA worth the risk?
It is time Churches outsource to an organization that specializes in this unique area of tax law. Chitwood and Chitwood have specialized in Churches and Ministers for more than 77 years. No one does it better than we do.
Our expertise assures every Pastor and Church that we represent, the peace of mind and freedom to do what Pastors and Churches should do – win the lost to Christ.
For more information on how to get your Church compliant, contact www.cmtc.org or call 800-344-0076 to register for a Church Management Tax Conference near you. Time is of the essence. Every moment you procrastinate in outsourcing your Church Accounting to Chitwood and Chitwood is another moment you are probably spending unnecessary dollars for unnecessary services.
We are the only service in the USA that can guarantee our services and back it up with our vast specialized experience.
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