August 15, 2011

Tax Credit?

Today’s blog post might just save your congregation some money.

Last week, Bishop Curry of the Diocese of North Carolina learned that two of the congregations in his diocese were eligible for a tax credit through the Health Care Act of 2010. Kristin Hoyle, a Raleigh CPA specializing in nonprofits who worked with these congregations, contacted the Diocesan Canon for Administration so that information about this credit could be shared throughout the diocese.

Wanting to quickly share this information with other congregations in his diocese, Bishop Curry invited Kristen to join him in creating a video informing congregational leaders about this program. And, to spread the word to the wider church, Sarah Herr, director of communications of the Diocese of North Carolina shared this information on the Episcopal Communicators list serv, which is how I learned of it.  

In the video, Kristin explains that churches with 25 or fewer employees who pay 50% or more of their employees health insurance and have a payroll of $50,000 or less, may qualify for a tax credit through the Health Care Act of 2010. And, because clergy do not participate in social security, their salaries are not included in the $50,000 cap. While the deadline for filing form 990T was May 15, when the IRS recognized that many churches did not realize that they could apply for this special tax credit, they extended the filing deadline.

Sarah reported that one congregation in their diocese received $12,000 and one in the Diocese of Southwestern Virgina received $30,000. This is no small amount for a small church!

To find out if your congregation qualifies, Kristin recommends working with a CPA in your area. Or, you can contact her at her office.