Pass-through Contributions

[RLM]

We recently had a Gospel singing group handling the Sunday morning worship service at our church. The question that I have always had lingering in my mind was whether contribution credit should be given to church members who make their checks out to the church and 'memo post' them for the singing group, etc. when I have not been told whether the group has 501(c)(3) status under the I.R.S. guidelines. Up until now, these pass-through contributions have been limited to other church organizations, missionaries, etc. that are known to have 501(c)(3) status. Can someone help me clarify when I can give contribution credit for a pass-through contribution and when it should not be given?

[NeilZ]

We recently had a Gospel singing group handling the Sunday morning worship service at our church. The question that I have always had lingering in my mind was whether contribution credit should be given to church members who make their checks out to the church and 'memo post' them for the singing group, etc. when I have not been told whether the group has 501(c)(3) status under the I.R.S. guidelines. Up until now, these pass-through contributions have been limited to other church organizations, missionaries, etc. that are known to have 501(c)(3) status. Can someone help me clarify when I can give contribution credit for a pass-through contribution and when it should not be given?

If its made out to the church, but designated to support an individual (such as a missionary) or group that is a for-profit entity, then this contribution is NOT tax free per IRS rules.

Not knowing how your system is setup, if this designation is used to help the church defray the cost of having the group, then it is tax deductible. However, if it is in addition to any money the church pays, then you're in a very gray area and I would error on the side of non-tax deductible.

[RLM]

Thank you Neil. These situations can be confusing. In this case, this was a group of men that are non-profit and volunteer their talents by going around to various churches to minister. The proceeds of money that they receive is used to support their prison ministry and to defray traveling expenses, etc. The church did not issue a check to them for that particular service. The only check from our church will be for the sum of the checks that were 'memo posted' for the group.