Churches must give attention to at least three key areas of financial life in the months ahead, noted Lee Wright, church compensation specialist for the Alabama Baptist State Board of Missions.
Wright recently directed a training session at the conference center of the Birmingham Metro Baptist Association.
Employees
The first area of concern has to do with employees.
“Churches often use contract workers for tasks such as custodial cleaning and lawn care,” he said during the Aug. 1 training. “These are not considered employees if, for example, they use their own tools or have no set hours. The church will issue a Form 1099 at the end of the year if they are paid more than $600.”
A special concern is liability insurance and workers’ compensation coverage. If contract workers don’t have this, many insurance companies will ask the church to include this in their coverage.
Then churches determine if other workers who are employees are exempt or nonexempt.
“Ministers are always exempt,” he said. “This means that they’re not eligible for overtime pay. One tax professional said a good application test is to ask if they ‘impart the faith.’ If so, their category is different.
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This article was originally published at TheAlabamaBaptist.org.
