Benevolence payments made to individuals are not taxable income. Not only do they NOT need to track it, they also do not need to ask them for a W-9—which means churches don’t have to report it on a 1099.
Who can a church give money to?
A church can give money to an individual provided certain stipulations are met prior to the giving. The church may provide a “benevolent love gift” to a person or persons, according to Christianity Today’s Church Law & Tax publication . Benevolent love gifts meet two requirements: The recipient must have a need.
How to request a benevolence gift from a church?
1Sample benevolence fund policy that a church could adopt to meet designated benevolence fund requirements. 2 Required Internal Revenue Service documentation for benevolence distributions to needy individuals or families. Download a Sample benevolence request formFree download
How did Pastor Steve Jones handle the benevolence gift?
At the close of the service, Pastor Steve called the church together to take up a special offering for the Jones to help them with their expenses. He had everyone make the check out to the church and put on the memo part of the check the wording, “Jones Family Benevolence Needs,’ so the checks would go to the right place.
Is there a designated fund for benevolence gifts?
Pastor Steve had his work cut out for him and his church. He needed to develop a designated fund policy to meet the benevolence needs of others. He needed this policy yesterday. After contacting several leading resources in church tax matters, he was able to bring the following policy to his church for adoption.
Who is not eligible to receive benevolence from your church?
Board members and their direct family members cannot receive benevolence from your church. The reason they are ineligible to receive any financial benefits from your church is spelled out in Treasury Regulation 53.4958-39(b). The IRS considers them disqualified persons due to their position of substantial influence in your tax-exempt organization.
