My wife and I (along with our baby boy) are just beginning careers as missionaries in Madagascar, working with YWAM. YWAM doesn’t manage or control any of our finances for us, and all of our support is going through our home church in Oklahoma (through whom both my wife and I are also ordained ministers). However, our home church merely receives the support for us and then deposits it once a month in our American bank account. They don’t list us as employees in any sense, nor as self-contractors – it’s a very small church so they actually only have 2 employees (both in Oklahoma) and both their incomes are so small, it’s only a housing allowance, so they only do whatever tax forms are required for that.

So, we’ve received no W2 or 1099 from them this year about the support we received through them last year. They did send a letter to the person doing our taxes for us this year, and it shows the amount of donations we’ve received through them. Where should that be listed on our US tax returns? Also, to be clear, last year we weren’t foreign residents (since we weren’t gone more than 6 months), but all years going forward we will be.

Any idea where to list our income on the tax form? And how to pay any social security taxes owed? (Since obviously nothing is being withhheld.) Please keep in mind that we’re living in one of the poorest countries in the world, working together with a local ministry (YWAM is essentially autonomous in each country) with mostly national workers, and so we’re also living at the local level… which is to say an income far below most missionaries and missions organizations. We don’t have the money to pay for any special tax lawyers or accountants to do any special forms or work for us, and as you said, most are unfamiliar with these areas of concern anyway. But of course, we want to pay the taxes we owe and not get behind and need to make up for it someday. Please let me know if you can help at all!

Thanks so much for your help! Your website is very informative.

I think missionaries are generally independent contractors. Therefore, for a non-US citizen who is also not a US resident, his taxes are between him and the Guatemalan government. I have no knowledge of Guatamalan law, but they should have no jurisdiction to require you to report or withhold. However, he surely has a duty to file a return and pay whatever he owes on his own.

I am the administrator at a church that supports a minister in Guatemala (and his church) who is not a US Citizen. Can you suggest how we should do that tax-wise?

I appreciate your advice,

Kevin

As I read the 1040ez instructions, you must file a 1040 and schedule C because you have self-employment income

I have another question.

I went on the mission field Dec 2008 after being on furlough in the U.S. Jan – Nov. Since I did not work while searching for my next assignment, I had no W2 or 1099 income.

I did have quite a few expenses (mainly presentation and mission orientation expenses) but my overall support for 2008 was very little.

Here is my question… Can I just file a 1040 EZ (and post that income on line 1) or do I actually have to file a 1040 & Sch C (which I would rather not do)?

I am more than willing to forego all of those expenses for the sake of being able to do my 2008 tax return by Friday. (It's called "I am in a hurry.")

Sorry to be in such a hurry but I tried to ask this of the IRS chat reps but they could not (or would not) answer my question.

Thank you.

As a rule, the 1099 should equal cash paid during the year. However, there's a principle called "constructive receipt," meaning you are taxed on money available to you just for the asking.

Therefore, if the church holds the money pending nothing but your request, it's immediately taxable although not yet paid. If the church would not honor such a request until the following year, then it shouldn't be taxable until paid.

(Note legal disclaimers under Author/Policies tab.)

I have been all over the internet and hope you might be able to answer my question.

It is my understanding that the amount on a 1099 corresponds to the money received (by the recipient) in that calendar year. In the case of a missionary, I would understand this to mean "the last/final check your church gives YOU for at the end of the year." This is always the way it has been handled (with my donations) in the past and should there be a discrepancy between the monthly checks (received by the missionary) and what the church is reported.

Simplified: If the church decides to hold donations sent at the end of December and give you the money in mid- January is that still considered income YOU received in the prior year?

I am a missionary currently serving in Kenya. I did contact the IRS chat but they seemed to have no clue and directed me to the international tax desk. (Although mine is just a question regarding reporting proper 1099 amounts.)

Any right answer you could provide would be appreciated.

Thank you,

B~