Church Controlled Organization

church-188087_640If you run an organization that’s run by a church, there are benefits to filing as a church controlled organization. Church controlled organization is a specific type of non-profit organization that is actually a very broad term that encompasses the “typical” church where worship of some type happens, an association of churches or a school that is principled, controlled, and operated by a church or an association of churches.

Types of Church Controlled Organizations

There are two types of church controlled organizations. The first is a qualified church controlled organization. To qualify, you must not offer goods or services for a price or receive more than one quarter of your funding from the government or other means like admission charges or facilities rentals. These are usually churches.

A non-qualified church controlled organization offers goods and services to the public and is allowed to receive more than a quarter of its funding from the government and other means. This type of organization includes hospitals linked to a local church, nursing homes, and orphanages.

Benefits Gained

File Form 8274 and you will not be responsible for FICA taxes. You have to fill out this form before quarterly taxes are due.  You must also fill out a W-2 that covers a two-year period.

If employees earn wages while working for a church controlled organization, they are required to pay self-employment taxes. Each quarter, they will be required to make estimated tax payments and fill out a Schedule SE at the end of the tax year.

Once a tax office closes, you have little option but to wait until they open back up. That’s not the case at Our online tax site is always open and we have experts available at all hours to answer your question, even on major holidays!

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