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Is gift for pastor deductible?

Your Legal Questions Answered

Is gift for pastor deductible?

My donation to my church included extra money for the Pastor. My church did not include this money on the donation letter for the year. Was this correct?

Probably yes.  Normally a gift earmarked by a donor for the benefit of an individual is not deductible and it sounds like this was earmarked by you and not the church.  

Tuesday, March 31, 2015

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Comments

The church appears to be using these separate gifts as compensation to its religious leader, and thus the "extra money" should be identified as a gift to the church and as taxable income to the pastor. As I understand the IRS tax code, gifts of money to pastors from their parishioners, when facilitated by the church for that purpose (as in this example), are taxable income. Such things as "extra money for the Pastor", "love offerings", "retirement gifts" etc. should be tallied on a Form 1099 and taxes paid on them as with any other non-salary compensation. Parishioners can then tax a deduction for such offerings as with any other gifts they make to the church.

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