![]() Also gone are deductions for electronic filing fees and fees you pay to fight the IRS, including attorney fees, accounting fees, or fees you pay to contest a ruling or claim a refund. These include the cost of tax preparation software, hiring a tax professional, or buying tax publications. The deduction is limited to the amount of taxable investment income you earn for the year. Although the items above are no longer deductible, if you borrow money to buy an investment, interest on that loan (called investment interest) is deductible if you itemize. These are fees for investment advice or management, tax or legal advice, trustee fees (i.e., to manage IRAs or other investments), or rental fees for a safe deposit box. You could also ask for a pay raise, but that would be taxable. Your best recourse is to ask your employer to reimburse you for these expenses. These are work-related expenses you paid out of your own pocket and include travel, transportation, meals, union and professional dues, business liability insurance, depreciation on office equipment, work-related education, home office expenses, costs of looking for a new job, legal fees, work clothes, and uniforms. If you are seeking legal advice, you are encouraged to consult an attorney.įor more information or if you need additional assistance, please use the contact information below. Readers should independently verify all information before applying it to a particular fact situation, and should independently determine the impact of any particular tax planning technique. Clergy Financial Resources and the author do not assume responsibility for any individual’s reliance upon the information provided in the article. ![]() Every effort has been made to assure the accuracy of the information. The article does not constitute, and should not be treated as professional advice regarding the use of any particular tax technique. This article is intended to provide readers with guidance in tax matters. Our professionals are committed to helping clients stay informed about tax news, developments and trends in various specialty areas. < BackĬlergy Financial Resources serves as a resource for clients to help analyze the complexity of clergy tax law, church payroll & HR issues. Visit our website at to sign up for a Pro Advisor session today and get answers to your important tax questions. This is much better than deducting them on Schedule SE, which will only save you 15.3 cents per dollar of expense.ĭo you have more questions about Schedule SE or Accountable Reimbursement Plans? Clergy Financial Resources is here to help. You get paid dollar per dollar for your expenses. Under an Accountable Reimbursement Plan, the church reimburses you for expenses as you accrue them. The best tax-savings actually occur under an Accountable Reimbursement Plan. Now it only reduces their self-employment tax. ![]() ![]() Keep in mind, reporting these expenses on Schedule A used to reduce both income tax and self-employment tax. This is also listed in IRS Publication 517, the instructions for the Social Security tax for Clergy and Religious Workers. In Revenue Ruling 80-110, the IRS concludes that members of the Clergy can deduct unreimbursed business expenses from gross income, but only when calculating their self-employment taxes on Schedule SE. When the Tax Cuts and Jobs Act passed, it eliminated the ability to deduct unreimbursed business expenses on Schedule A for all taxpayers… Fortunately, there is still another way to deduct some unreimbursed expenses for members of the Clergy. It used to be that if you paid for business expenses out of your own pocket, you could deduct them on Schedule A.
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