Other expenses a Minister is allowed

Forum|Forum|5 years ago
March 30, 2021
7 replies
41 views

This is my first Pastor return. I know the church income goes to Schedule C and the housing goes to Schedule SE. The housing costs interest and taxes Schedule A, but the Standard Deduction will be used. He purchased computer equipment and built it for exclusive church work. This included a Laptop and Desktop replacement for the Pastor. Secretary/Treasurer home equipment . Total is $4,755.45. Is this an allowable deduction and if so where?

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Best answer by TaxGuyBill

He is the pastor of Liberty Baptist Church. He is not the owner. Since the very beginning he has been a 1099 individual. Due to his actual profession, as an engineer, he purchased and built the computer equipment. Liberty Baptist did not reimburse him.

If he truly is an Independent Contractor (which seems wrong), business expenses are treated just like any other Independent Contractor - on Schedule C.

T

TaxGuyBill

@Foxy-Lady wrote:

I know the church income goes to Schedule C

I would suspect that most religious employment would be the pastor/minister/priest/etc. being an EMPLOYEE with a W-2, rather than an Independent Contractor. Have you looked in to that aspect of it?

F

Foxy-LadyAuthor

Level 4

There are no employees just him as the pastor. He has other W2 employment. I just need to know about the equipment he purchased for the exclusive use of the church. Can I show it as supplies on the 1040C?

qbteachmt

Level 15

You keep using the phrase "the church;" is this person running their own church? That's what is confusing. They run their own church; or they work for a church? Or, you have two different churches, and the other church pays him as an employee on W2, and the Sched C is for the SE part of that job?

As a Sched C filer, he won't have someone else's ("the church's") equipment on his own return. He would have his own equipment on his return, for doing the other work or, his business associated with being an independent minister not working for "the church."

That's where this gets confusing.

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qbteachmt

Level 15

I guess we never really answered:

That is expensive equipment. I suggest you read IRS guidance for Expense vs Capitalize.

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