User Support Forum

I want to thank all those that have posted and answered in these forums, it has been a source to find many answers to my questions. I’m new to the PC+ world, and in setting up the Payroll, I’ve found that we have not been properly accounting for the Pastor’s “Accountable Reimbursement Plan.” from previous years.

In setting up our salary for our Pastor, the item breakdown is as follows per weekly check:
A. Salary
B. Housing
C. Medical
D. Insurance
E. Professional Fees
F. Retirement (His personal account)

He also receives a monthly check for:
Professional Fees
Vehicle Fuel
(Would these be considered reportable income also?)

The previous bookkeeper deducted his expenses at the end of the year for the W2 amount, according to other information I learned his expenses should be reported to the church at least quarterly. How is the best way to reflect these reimbursements and does anyone have an example they could send me on how they have theirs setup?

Thanks in advance for any assistance!

We use the payroll module to handle salary, taxes, benefits and pension (all items that go on your W2 (US) or T4 (Canada)). Other reimbursable expenses such as books, vehicle fuel, conferences, taking people out for coffee, etc. are handled through the accounts payable module and are not reported on the W2 (or T4).

I'm in Canada, so I'm assuming that the U.S. government includes the same kinds of items on the W2 as on our T4. I would check with your local federal tax office to verify what items need to be reported on a W2. All reportable items should be processed in your payroll module so that you can easily run a report at the end of the year to complete the W2 forms. Because of Canadian tax laws regarding clergy housing, we don't need to separate out the housing portion of the pastor's salary for our T4 forms. We just report the entire salary and the pastor files for a housing credit based on the market rental value of his home.

In our chart of accounts, we have a section for Pastoral expenses and it includes lines for the Pastor's salary, the employment insurance, government pension, denominational pension, income tax, group benefits, (all of those are processed through payroll) and then lines for Professional Development (conference fees, course tuititions, books, etc), Travel Expenses (parking, vehicle fuel, airline tickets), General Expenses (basically allowable meals when taking someone out to talk). Any other expenses are posted to the appropriate lines like office supplies, community care, etc. At the end of each month, I print out the income & expense statement for the month and submit it to the church finance chair who reviews it. Quarterly he prepares an overall income/expense balance blurb for the church bulletin. The only time the congregation sees information on specific expense lines is at the annual budget meeting.