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Level 3
July 29, 2020
Question

How do I expense a ministers expenses when he is the owner of the church as well

  • July 29, 2020
  • 16 replies
  • 51 views

I have a minister that just opened his first church he is trying to expense the repairs and supplies for the contractors will this be the K-1?

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16 replies

qbteachmt
Level 15
July 30, 2020

"he is trying to expense the repairs and supplies for the contractors"

If you are describing Building improvements, that isn't expense. It is Asset investment.

He "owns" a church, but that doesn't describe if he also owns Property or Real Estate.

It would be more helpful if you gave description and details. For instance, is this person renting a building and improving it to use for church services and operations?

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qbteachmt
Level 15
July 30, 2020

Oh: A K-1 is a form that comes from an entity's tax return, such as 1120S (S corp) or 1065 (partnership). Nothing you described helps us understand what is the tax return or entity type of the Church? Perhaps the Church is filing using Form 990?

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KhsBizAuthor
Level 3
July 30, 2020

Thank you,  the Pastor purchased the building and they renovated the building.  I am aware that the minister can only expense certain things in his Schedule C as this is his first year with the new building and expenses.  Will the church itself have to file a separate return in order to not mix the renovations and church expenses on the Schedule C (Hope that explains it better)

qbteachmt
Level 15
July 31, 2020

It's too bad that he owns the building personally, because a Church owning the property typically avoids property taxes. What it seems to be, is that this person has Property, and there is a Church using it, and he also works for that Church. Which means all of this should have been better thought out.

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