Frequently Asked Questions

 

 01 Is Church Financial Management a business?

No, Church Financial Management is a 501(c)(3) nonprofit ministry.

 

 

 02  Whom does Church Financial Management serve?

Church Financial Management provides assistance to churches, nonprofit ministries, and individuals seeking assistance.

 

 

 03 Does our ministry have to choose all the services offered by  
               CFM in order to receive assistance?

No, we custom tailor all our cost recovery fees based on the individual church profile and what services or assistance the church desires.

We call it "a la carte" pricing.

 

 

 04  What if I just have a quick question and I am not really looking 
                 for services or consulting assistance?

Click on the Contact page and send us an e-mail. We would love to assist your ministry however we can.

 

If the question requires a short response there will likely be no charge. If there needs to be more in depth conversation then there will be a cost recovery fee as outlined on our Investment page under Individual Consulting Sessions.

 

 

 

 05 Are ministers/clergy employees or self-employed for federal tax purposes?

 

Ministers have what is called a dual tax status. They are considered employees for federal income taxes, but are considered self-employed for Social Security/Medicare with regard to services performed in the exercise of ministry.

 

 

 06 How does our church's pastor withhold payroll tax?

 

In short, there are two ways to handle paying payroll taxes. First, the minister/clergy himself can pay estimated taxes throughout the year to the appropriate taxing authorities. Second, the church can voluntarily agree to withhold payroll taxes and remit to the appropriate taxing authorities on their behalf.

 

 

 07 Is a minister Housing Allowance retroactive?

 

No, the allowance is not retroactive. The church board should act immediately to approve a remaining portion of the minister/clergy's remaining compensation as housing allowance.

 

 

 08 Should our church have an Accountable Reimbursement Plan?

 

Yes, this proves to be great way to provide business related reimbursements to employees that are not subject to taxable income. This can be a significant tax savings to ministers and employees.

 

 

 09 Is our church's EIN (Employer Identification Number) also our tax exempt number?

 

No, the EIN is your church's unique identifier that allows you to file tax withholdings and corporation reporting. The tax exempt number must be applied for either through a "Group Exemption" or by completing the IRS Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code.

 

 

 10 Does our church need to incorporate?

 

Technically the answer is no. However, we would highly recommend that each church incorporate with their state. Incorporation does the following: It establishes church identity and legitimacy, it provides protection to the members of the church by taking the liability off of each member and placing it on the entity, it allows the church to withhold and file payroll taxes, and allows the church can carry insurance and hold property in its name.  

 

 

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