Tax Services for the Modern Church: Claiming Tithes on Taxes

The concept of tithing consists of donating 10 percent of income to a church. This modern notion of tithing has been around for quite some time. Many believe that tithing began with the Old Testament example first recorded in Genesis, then again in the book of Numbers when tithing was included in Mosaic Law, with its purpose to provide for the Levites.

Despite how it began, tithing has been around for a long time and still remains an important aspect of modern religion. Tithing combined with tax services is a more contemporary concept. Modern tithing usually takes the form of cash, cash equivalents or stock donations. When preparing your taxes, it’s important to remember that if your church is a qualified organization, your tithes and one-time donations may be considered tax deductible. However, they must meet IRS guidelines to be deductible. You may want to confirm your deductions with a tax professional before submitting.

Itemize Your Deductions

Tithing is tax deductible as long as you elect to itemize deduction on Form 1040, Schedule A. If you only take the standard tax services deduction, these contributions are not considered deductible. A benefit to tithing a specific percentage of overall income is that you can estimate how much you will be paying to your religious organization over the year and this estimated amount can confirm whether or not you will have sufficient contributions by the end of the year to justify itemizing.

Qualified Organization

Church or religious organizations are only tax deductible if the organization is qualified. The IRS website offers a database for qualified organizations on its website. You can also check with your local tax services provider.

Fair Market Value

Tithing is not paid in return for goods or services so it’s fully deductible. However, if you make contributions to a qualified organization and receive goods or services in return, the amount of the donation in excess of the fair market value of the good or services received may also be tax deductible.

Make Tithing Trackable

Paying by check ensure that you have record of your contributions. Most churches also provide envelops to keep track of cash donations, make sure to utilize these or use your own envelopes when donating cash. Also if paying via check, make sure to use the memo section of the check so that you know what that check was for.

Detailed Records

The IRS requires written record of all charitable contributions. At the end of the year most churches will send an end-of-the-year report with contribution made. It’s also a good idea to have your own records that you can submit to your tax professional that includes contributions made to other organizations as well.

Get Written Acknowledgement

If you contribute $250 or more to your religious organization, you must receive and retain a written acknowledgement from the organization. It must state the amount of cash donated and whether or not your received anything in return.