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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7523
Experience:  15years with H & R Block. Divisional leader, Instructor
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If a non-profit (501c3) pays my mortgage or bills, is that

Resolved Question:

If a non-profit (501c3) pays my mortgage or bills, is that considered taxable income to me?
Submitted: 4 years ago.
Category: Tax
Expert:  Robin D. replied 4 years ago.

HelloCustomer

Thank you for using Just Answer.

There are many non profit organizations that are set up for the purpose of helping individuals with just such needs.

If a nonprofit organization paid debts for you without any requirement on your part for services then the amount would not be taxable to you.

If the nonprofits purpose is to assist individuals with this type of help then the payments would not be taxable to you.

I sincerely XXXXX XXXXX information is helpful,

Customer: replied 4 years ago.
ok... so what if it is a regular thing? we're planning on going on missions, and our church wanted to pay our mortgage for the year while we're away.
Expert:  Robin D. replied 4 years ago.

Hello again,

That makes a big difference. The support you would be receiving from the church would be taxable. Unless you are an employee of the church. Even though they are going to be paying your mortgage for you the amount paid would be considered as if they had given you money. You will include the amount on a Schedule C. Schedule C net income is subject to both self-employment tax (Schedule SE) and income tax. You would most likely have expenses to claim against this income.

 

Thank you for the additional information about your situation,

Customer: replied 4 years ago.
What if I was also an employee of the church? Wouldn't it then be considered w2 income?
Expert:  Robin D. replied 4 years ago.
If you are an employee of the church then the amount of compensation would be shown on a W2.
Customer: replied 4 years ago.
what other options do we have? we have a private family foundation (also a 501c3)...
Expert:  Robin D. replied 4 years ago.

If your foundation wishes to sponsor you that would be different. But if the church wants to have you as their missionary that they sponsor then any amount paid to or for you would be taxable to you.

Any money given to you by individuals would not be taxable to you nor deductible to the giver.

Customer: replied 4 years ago.
What if it was from a foreign corporation? One of the major donors at the church donates from a BVI IBC... and He's the one who would be really funding this anyhow.

Ultimately I'm trying to figure out the best way to receive this money. Our mortgage is a greater portion of our income. :)
Expert:  Robin D. replied 4 years ago.

If an individual gives you the money directly there is no tax liability to you. If it comes to you from the church then it is income. If it comes from some other source then it would depend on the source and their classification of the gift to you. If it is a source that hires missionaries to go abroad then you would be an employee of the agency. If it is a foundation that offers money to do this type of work then it may be taxable.

Any money spent by a private foundation that is not consistent with the foundation's charitable purposes is called a "taxable expenditure." Taxable to the foundation.

 

If the major donor with the International Business Corporation in the BVI wishes to pay this for you directly then you would not be taxed on the gift.

 

Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 7523
Experience: 15years with H & R Block. Divisional leader, Instructor
Robin D. and 4 other Tax Specialists are ready to help you

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