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Why have you made a video in a room without a stick of furniture… or anything. You’ve made an echoing, booming video with inexcusable results. Have you listened to your video before you posted it? No one else listened to it. How do you miss such a basic criteria about a voice only video? The entire video is nothing but your voice, and you put out this crap? A thumbs down.
If you're clergy status, taking the housing allowance won't hurt you. There's times where it might not help, but it shouldn't ever hurt. It is going to reduce your taxable income and unless your income tax is already zero, it's going to help. Now, if you have the choice somehow between being treated as a clergy employee and a "normal" employee - then it depends and you would need to look at the specific numbers to determine which one was better.
Also I was thinking about AMEX stock, and it’s in their earnings reports that the bonuses are a flat out bribe to customers. They do lose money. Watch any number of videos about how AMEX will close accounts on people doing too much spend on junk categories. Because they lose money. Point being, the points aren’t just a scam, they have real value, and are more about getting valuable high spend customers into your ecosystem. High spend because these people use the cards for purchases they were already making, and paying off the balance. For them it’s all about swipe fees, the point is to give you back some of your money because the issuer knows you are worth paying to keep, the merchant doesn’t necessarily know that, they pay AMEX to figure that stuff out.
Ramsey is right about the psychology of credit cards, you don’t feel like you’re spending the same as cash. But Ramsey is super simplistic and gives really bad advice a lot of the time.
Couldn't agree more about the psychology. And if i were him (speaking to millions) I would also have a zero tolerance policy for credit cards. However, there's a way to budget where you can prevent spending more simply because you're using a credit card... but financially disciplined individuals are not exactly his target market, so it makes sense he does not speak to them on air.
If the social security and medicare wages and taxes are filled in, make sure it was on the full amount of wages (sometimes on a single W2 you have clergy wages mixed with regular wages if their position changed mid-year --- if that is the case, you have to get the totals right and enter it as if it's actually 2 different w2s to get it to report correctly). If the taxpayer is clergy and the church withheld these taxes, you should have them fix it moving forward. It is incorrect.
Dave Ramsey is excellent for people that don’t know how to manage money. But not so much for anyone else. Why not use a credit card and get points for flights or travel when you’re going to make those purchases anyway. Plus, it is better fraud protection than debit card. his argument for using a card versus cash also is because you spend more. OK that may be the case. But if you’re someone who still pays it off weekly or monthly and carry no interest balance. Again it’s a no-brainer.
Thanks for watching and commenting... I see why Dave Ramsey has a zero tolerance policy given the credit card debt problem we have, but I also agree with you... there are people who can use them responsibly and utilize the benefits you mention.
@@IntentionalFinance101 It’s a good stance for people that are bad with credit/finances, but as a whole, not really. Even if 2% of $1000 is only $20, that’s still $20 more than I would have if I paid with a debit card or cash.
I use a credit card arbitrage strategy with my 2% cashback card. Here's what I do: First I use Fidelity cash management accounts and a Fidelity brokerage account that I use like a savings account. Paychecks are deposited in the brokerage account currently making 4.94% but funds are completely immediately liquid. Then let's use my electric bill as an example. Paid electric bill of $188 on June 1st, get the 2% in points for cash back for that. June 13th my credit card statement comes out, and will be due July 8th. Instead of having paid out that $188 in cash on June 1st, I will let it sit in my brokerage until July 8th earning 4.94% interest annualized AND having earned 2% back. I take the points as a statement credit when I can so I end up paying out a bit less when I pay the bill, I've gotten a free loan of $188 for about 5 weeks or so that I've used to earn interest. Repeat for ALL bills and purchases that I can use the card on without incurring an additional processing fee (some of my bills will charge like $2 to pay with a card vs. cash so those I pay cash). Then on the credit card due date I pay off the whole statement balance. SO by doing this consistently I'm not getting just 2% back I'm getting more like 6.94%. One has to be disciplined with it, but yes the system can be worked to one's advantage.
Let's imagine you earn $100,000 as your Gross/W2 Income. Let's assume you live under a government regime and taxes 90% of your income, your net income would only be $10,000. If you give 10% of your "Gross income/before taxes" to the Church, your income would be zero, leaving you with nothing to live on. Taxes should not be equated with everyday expenses like a house, car, or the internet. In reality, you are not actually earning $100,000 as it's not a true reflection of what you earn. In this case, your earnings are $10,000 to live on; it doesn't matter what on-paper your salary says or looks like.
You can always come up with extremes to break any example. I don’t think that’s very helpful. My video was an example of what I do. Ultimately it’s up to you and your convictions what you do. I’m not God, so I won’t be the ultimate judge…
@@IntentionalFinance101 Relax, my brother, my son is older than you; I also loved our LORD JESUS CHRIST. I need your advice then. Back in 2004, I was employed by the Air Force/Government, using a corporate credit card for my expenses(Hotel, flight, FOOD, Rental Car, etc.). My salary as an Airman basic was $1,200, but my monthly expenses were around $10,000. This complex financial situation led me to question the implications of my tithes. Moving to 2024, I started working for FEMA as a contractor. However, I had to pay for all my expenses with my credit card FIRST (hotel, flight, food, rental car, etc.), and then they reimbursed me in a lump sum at the end of the month. During a slow period with less work and no pay, they asked me if I wanted to stay at a hotel for a month while waiting for more work to come in. My question is: during that month, I was living at the hotel and not receiving any salary; how should I calculate my tithes when I'm not earning any money but getting paid for the hotel, food, car, and other expenses?
@@robertomontanez1163 It's just an opinion, and I'm not pastor, but to me, that is not income. That's an expense of your employer that you just happen to be paying for them and then they're reimbursing it. So it's a nonfactor in decided how much to tithe. Honestly, a good employer would pay that up front instead of making you front the cost.
What if the company you work is responsible for not taking the right amount and everytime you fill, give the company the amount you tell them. What should I do? Because l can't afford it. Mercy Drive Inc 1314 blondell Ave , Bronx ny 10461.
I’m not sure I completely get it with there being a few typos in your message… your W4 tells the company what to withhold and if you’re not having enough withheld you need to complete the W4 in a way that tells your employer to withhold more. There’s a few ways to do that. One is to use step 4 to enter a dollar amount of extra withholding per paycheck.
@@OdinUchiha It's hard to help sometimes without seeing and understanding the full picture. I'd recommend you reach out to a knowledgeable tax professional in your area who can look over the documents and help you resolve any issues.
Just because the caller doesn’t have credit card debt, it doesn’t mean they are debt free. They could have other debt (car loans, general loans, mortgage loans, student loans, medical loans etc.) The issue is, most people don’t control their credit card usage. If people were, the banks would drop these perks. They offer them as they know people will overspend. Most people are not beating or outsmarting the Bank. Do you think these banks are offering these points/cash back because they suddenly feel guilty? People tend to overspend on credit cards (even if they settle their balance every month) which has been proven.
I don't disagree with anything you said. And it's why a vast majority of people should probably avoid credit card usage. However, we're party far now from when cash was the predominant form of payment. People who spend on credit cards vs a debit card, when they have the money, don't spend anymore than they otherwise would. Cash vs. plastic (whether it's debit or credit) probably does lead some people to spend more than they would with cash, but not everyone. The way we budget, I don't spend a penny more no matter which form of payment I choose and there are others out there like that too... so back to what I said in the video - Dave Ramsey is narrow minded in his view and while his advice is great for the masses, the are people who fall outside of it and would be perfectly fine utilizing credit cards. I stated I also don't think they're 'beating the system' or the banks... just utilizing a card and getting some cash back.
We made car payments to our retired minister's car until it was paid off. Last year we sent of a lump sum to pay it off early. Does he get a 1099 NEC for those payments... or a W2... He retired in early 2021 and we finally paid it off in 2023. Thanks
It's definitely taxable. Since it's pastoral, it's subject to SECA either way... but still best to do it right of course. If he's still the active pastor, probably a W2. Since he's retired... is he still performing services for the church or not? Probably still a W2 if he is.
We made car payments to our retired minister's car until it was paid off. Last year we sent of a lump sum to pay it off early. Does he get a 1099 NEC for those payments... or a W2... He retired in early 2021 and we finally paid it off in 2023. Thanks
It's definitely taxable. Since it's pastoral, it's subject to SECA either way... but still best to do it right of course. If he's still the active pastor, probably a W2. Since he's retired... is he still performing services for the church or not? Probably still a W2 if he is.
@@IntentionalFinance101 Thank you for answering my question. I figured it was taxable. He has not performed any services for us since being retired. The board bought the car before he retired… but afterwards we kept making his payments. Thank you again.
I think you’ll be fine either way. Still seems like payment for services… even if it’s past services at this particular point. I haven’t seen this before but I think I’d lean towards a w2 (without having researched it myself).
You should ask the employer. Box 14 is usually informational. So it probably means that there was an auto allowance or payment of some sort that is likely already included in box 1 of the w2. You shouldn’t have to do anything with the box 14 auto amount if the employer did the w2 correctly.
Excellent video! This was so helpful. If a hypothetical pastor had his taxes done with a tax service who did not report his SS/medicare wages on Schedule SE for, let's say, the last 8 years, what do you recommend he do? How far back should he amend? Are you available for consultations? If not, do you have any resources I can recommend to this hypothetical pastor? Thanks in advance.
Thank you for letting me know. I’m glad it was helpful! I’d definitely say to get it done right in the current year and moving forward, that’s number one. Then I’d say to get some advice on the prior years. Yes, we do consultations and look over prior year returns.
Will people please stop giving Dave credit? (Pun intended) even if he is correct on some things, people who keep saying that he is right will cause him to become more arrogant.
I don't have any issues with Dave Ramsey. If he's right, it'd be ridiculous to say he isn't just because you don't like him. So where I agree with him, I'll mention it, and where I don't I will point out why. He helps a ton of people and I can't take any issues with anything he says as being wrong (except for that 8% retirement withdrawal rate... look it up if you haven't seen anything on that because that is flat out wrong), but I do disagree with him on some things, such as the credit card issue.
@@IntentionalFinance101 I'm not saying don't, but it is important to note that for each person saying that he's right and he sees it; it will cause a boost to his ego and he will continue doing what he does.
I love my church family and what God is doing there. If you are at a church you don’t want to give to I would suggest that you should look for a new church. Also, you can give both to the church and to the needy (and those might not be two different things).
@IntentionalFinance101 assuming your church keeps its books open and shows what money is going to what charitable things, I agree. Accountability is my only concern. I'd be amazed if you could tell me honestly how much is donated to your church vs the charity work.
@@davidspencer343 I would find a new church if I didn't trust the leaders at the one I attend. I'm not really worried about other churches honestly because I don't go to them or give to them and I can't police every church that exists.
@IntentionalFinance101 I personally wouldn't trust any charitable organization without open books regardless. If they don't openly disclose their spending and salaries, it's suspect by definition. You should ask your church if they do. If it turns out it's secret I'd wonder
@@davidspencer343 That's the beauty of it. You don't have to. I am involved at our church and have no concerns. Financial information is shared. I appreciate you watching and commenting. Thanks for you input and engagement.
Wouldn't your "Increase" mean Profit? And as a busines owner Profit is what's left after expenses and taxes. If you pay 10% from your gross then 30% for taxes, add another 20% for business expenses, your left with trying to live on 40% of your Gross. Thats easy to do when your making 200K or more. But as a very small business owner making only about 50K, that would leave me with $20K to live on which is poverty level. If a W2 employee pays tithe on what they actually got paid, it would make sence that a self-employed individual would pay tithe after business expenses and taxes. Even God said give to Caesar what is Caesar's and give to God what is God's. That would mean that we wouldnt pay tithe on the money we pay for taxes.
Ultimately I believe this conviction is between you and God. This was an example. Honestly though, I think most people find it harder to tithe when they make more, especially if they weren't tithing when they made less. I am in a service based industry with low overhead. So tithing off gross is possible. However, pretend you were selling merchandise and you had $5M gross but only net profit to yourself of $200,000. You couldn't possible tithe off gross. So it's definitely not something everyone can or should do. I did and always have tithed off gross W2 payroll check though. That was a personal conviction of what my "increase" was.
I agree with you 100%. I use credit cards to pay for just about everything, and apply the cashback money to my balance. When I get my bill I just pay the full balance. Ramsey is Wrong.
Thank you, as a minister, this video was very helpful. I do have one question. From what I could tell, you did not input any unreimbursed business expenses for the ministerial portion of the income. I do have some expenses that I believe would qualify, but I cannot find where I would input those on the turbo tax program. If I try to do it in the self employment section, it wants me to put in my income, which has already been calculated based on the ministerial and housing allowance questions.
You cannot deduct (at the federal level) unreimbursed business expenses as a w2 employee between 2018-2025 based on the tax cuts and jobs act passed in 2017. It used to be an “other itemized deduction” subject to the 2% AGI limitation. But it’s not currently available.
Ramsey didn't answer the question. He shows his complete ignorance. If you pay your balance each month it is a interest free loan. What does arrogant Dave not understand.
Oh, he understands, but he has to reframe the question because he can't answer it. He can't go back on his 20+ years of being anti credit card, even when the situation would be ok for someone to use a credit card.
He definitely comes across that way at times on the show. Never met him personally to know what he's actually like though. There's probably a difference in someone's true personality and their celebrity, public figure persona.
Turbo tax for 2023 this year SUCKS. I did my taxes just fine and then I wanted to do my son's return and turbo tax lost his last years information as well as his account. There is no" start a new return". I could not find a phone number. The chat wanted me to pay $55 for an answer. 👎👎👎👎
Expenses count in the year paid for cash basis taxpayers (pretty much every individual is a cash basis taxpayer, it'd be pretty rare for someone as an individual not to be cash basis).
I have parent plus loans that i dont start paying for another 2 yrs. Do i get to write that off on my taxes? Im confused when it comes to the college tuition questions on tax return
@@Roowzer you can't deduct student loan interest until you pay interest on the loans (it will be reported to you every year on a 1098-E). However, if you're referring to tax credits related to the tuition itself, that would be done in the year the tuition is paid (whether with cash or with loan money)
Yes, the 1098-T is critical. It can also be good to have a record of all financial transactions from the finance office of the college since the 1098-T may not be all inclusive...
@@IntentionalFinance101 Oh My Thank You So much, I actually just told my Son to go to his college office and get those forms for me, my son Grandma on his dad side carried My son on her taxes with no permission, I have never ever allowed anyone to carry my son, Only Me , his entire 18yrs, and the IRS rejected my taxes, and gave her the refund, so now my tax lady did a mail in certified tax for me , and now I'm waiting to see what will happen, and his grandma didn't even use his 1098T to file her's behind me and my son back
@@OGCuties That is a pain when that happens and filing on paper is the only way to handle it. You may also end up with a letter from the IRS that you'll have to respond to as well.
I don't have any assets. I live in a senior living homes. My only real assest is an old couch given to me from another residènt. I own the used couch and a walker and a dresser. I do not own a car or anything if value.
Yes, there are some differences. It’s a little more than I can type here in the comments bc it depends on several different factors in each situation. I’d recommend contacting a professional to help you out.
I put some clothes I had out grown in a friend’s vintage store for 6 weeks when she was starting out. She charged me 25% of sales for space. I purchased things to display, tag, package items. Thrifting is my hobby so I picked up a few things to fill up the space. I didn’t receive an itemized list of my sold items. Do I need to claim this on my taxes?
The clothes you out grew sound more like a yard sale to me (items that you purchased a while ago for personal use, are worth less than you paid for them, and are now being sold). However, "thrifting is my hobby" sounds like you also purchase and resale thrift items, in which case that would need to be reported possibly as a hobby or possibly as a business based on the criteria and facts.
Dude why would you not give the details of the changes? You could’ve said all that in 30 secs. A lot of words not a lot info. Just feedback if you want people to come and watch your videos.
Thank you for your incredible resource. I did my own taxes this year as a pastor and this was the perfect video to give me the confidence I was doing them correctly. I hope you will continue to make videos.
Sue the irs, if you can't pay. If you threaten legal action they have to pause. If an irs bill threatens your survival, you can sue them for undue hardship, even under the 13th amendment for slavery. These cases can bring in 100k+ for victims. Sue them and prove the hardship that's all it takes, but if you do nothing, they will just enslave.
Thanks for the comments... I don't think you sue the IRS... but certainly you can file a tax court petition and fight the tax if it isn't correct. I'm not sure where the 13th amendment comes into play either... but there are certainly situations that arise where I refer clients to tax attorneys. This was a general overview of some of the most popular options when you can't pay your taxes. Suing the IRS just for the sake of stalling the proceedings I would imagine would get tossed out of court pretty quickly.
