Clergy Financial Resources | Clergy Tax Net

10/05/2026

Up to $5,120 of the Adoption Tax Credit Is Refundable for 2026 – Did You Know?

The Adoption Tax Credit helps eligible families manage qualified costs such as adoption fees, travel, legal services and home studies. In recent years, the credit was nonrefundable: it could reduce a person's federal income tax, but any unused amount generally had to be carried forward.

Under rules that took effect in 2025, part of the credit is now refundable. For tax year 2026, up to $5,120 per eligible child may be refundable, even if the taxpayer owes no federal income tax. Any unused nonrefundable portion may be carried forward for up to five years, but a carryforward cannot become refundable in a later year.

The Adoption Tax Credit is subject to income limits and other restrictions, and the timing of a claim depends on the circumstances of the adoption. A tax professional can help determine whether you qualify and how much credit you may claim.

10/05/2026

Pastors and church leaders: now is the time to set up your 2027 housing allowance.

Your church has to designate the housing allowance IN ADVANCE, by official action such as a board or council vote recorded in the minutes, before the payments are made. A designation made after the fact can't be applied to income you've already received.

A quick refresher: the amount you can exclude from income tax is the lowest of these three:
✔️ The amount your church designates
✔️ What you actually spend on housing
✔️ The fair rental value of your home (furnished, plus utilities)

Put it on your church's agenda before December 31. Questions about how much to designate? Our team has helped clergy with this since 1980. Send us a message!

Call now to connect with business.

09/29/2026

Enhanced Tax Credit Can Help Cover 2026 Childcare Costs – Did You Know? (2/2)

If you pay for care for your child under 13 years of age, or for your spouse or other dependent who requires help with basic self-care, then you may qualify for a federal tax credit. The Child and Dependent Care Tax Credit (CDCTC) can help reduce your federal income tax based on care expenses that you pay in order to work or seek work.

The CDCTC is calculated as a percentage of eligible care expenses. As in the past, the credit is subject to phase-down ranges, meaning that the maximum credit amount may decrease based on a person's adjusted gross income (AGI). However, new rules that took effect this year have significantly increased the maximum credit amount for people with AGIs both below and within the phase-down ranges.

For example, a married couple filing a joint return with an AGI of $75,000-$150,000 may qualify for a credit of up to 35% of eligible care costs, up from 20% in 2025. Meanwhile, a single filer with an AGI of $15,000 or less may be entitled to a credit equaling 50% of qualifying expenses. Above $15,000, the rate gradually declines, reaching 35% once AGI exceeds $43,000. A tax professional can help you determine whether you qualify for the CDCTC, and if so, what percentage you may use to figure your credit amount.

09/22/2026

🎙️ New episode of Kingdom Impact 5 is live!

"Can Our Church Employees Volunteer at Our Church?"

It happens in nearly every church in America, usually on a Saturday, usually with coffee and donuts involved. An employee shows up on their day off to help set up chairs or run sound, and nobody thinks twice about it.

A brand new Department of Labor opinion letter just gave church leaders a reason to look at that a little closer, and it came from a place you'd never expect. In under 5 minutes, Josh Friesen breaks down what changed and the one question every church leader should ask before the next sign-up sheet goes around the room.

🎧 Listen now: https://clergyfinancial.substack.com/p/922f6a8e-2b75-4627-9fd9-7f2327583ef3

09/21/2026

Enhanced Tax Credit Can Help Cover 2026 Care Costs – Did You Know? (1/2)

If you pay for care for your qualifying child under age 13, or for your spouse or other qualifying person who is physically or mentally incapable of self-care and lives with you for more than half the year, then you may qualify for a federal tax credit. The Child and Dependent Care Tax Credit (CDCTC) can help cover care expenses you pay in order to work or seek work. Rule changes that took effect this year have made the CDCTC more valuable for many households.

As in past years, you may use up to $3,000 of eligible expenses to figure the credit for one qualifying person, or up to $6,000 for two or more qualifying persons. However, beginning in 2026, the maximum credit rate increased from 35% to 50% of eligible expenses. The applicable percentage declines as adjusted gross income rises, but many households may qualify for a larger credit than under prior law. The increase can be as much as $900 for taxpayers with two or more qualifying persons.

In general, the CDCTC is available for all filing statuses except married filing separately (MFS). However, MFS filers may qualify if they meet special requirements, including filing separately, maintaining a home for a qualifying person for more than half the year, paying more than half the cost of maintaining the home, and not living with their spouse during the last six months of the year. To claim the credit, you must provide information about both the care recipient and care provider on your tax return. A tax professional can help you determine whether you are eligible for the CDCTC, and if so, help you meet the reporting requirements to claim the largest possible credit.

09/15/2026

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As part of our ongoing commitment to helping churches and nonprofits thrive, we have partnered with Mineral to provide your ministry with complimentary access to the Mineral HR Basic Platform.

09/14/2026

Tax Rules for Scholarships, Grants and Fellowships - Did You Know?

Common questions about education expenses relate to whether scholarships, fellowships and grants constitute taxable income. These awards are generally tax-exempt when received by a degree candidate at an eligible educational institution and used for qualified education expenses, including tuition, required enrollment fees, and required course-related books, supplies and equipment.

However, taxes may apply to funds used for nonqualified expenses like housing, food, travel and optional equipment. Fellowships that carry a work requirement, such as serving as a teaching assistant, are generally taxable compensation to the extent they represent payment for teaching, research or other required services, subject to limited exceptions.

The educational institution or scholarship provider should provide you with detailed information about the potential taxability of funds. By reviewing that information with you, a tax professional can help you maximize both tax benefits and peace of mind.

09/14/2026

Your church just cut a check to a missionary on the field. Now what? 💸

Is it a W-2? A 1099? Nothing at all? If you're not 100% sure, you're not alone. Missionary support is one of the trickiest gray areas in ministry finance, and getting it wrong can mean an unwelcome letter from the IRS down the road.

The good news: Josh Friesen breaks it all down in under 5 minutes flat. No jargon, no headache, just a quick, clear answer so you can handle your next missionary support check with total confidence.

🎧 Listen now: https://clergyfinancial.substack.com/p/does-my-churchs-missionaries-need

Kingdom Impact 5: practical church finance answers, five minutes at a time.

09/08/2026

Quarterly Estimated Tax Payments - Reminder

If you are making quarterly estimated tax payments to the IRS, the due date for the June 1 - August 31, 2026 payment period is coming up next week on Tuesday, September 15, 2026.

For payments made using IRS Direct Pay, you can make payments until 11:45 p.m. ET on the due date. Debit and credit card payments may also be made online through an IRS-approved payment processor.

09/01/2026

Educator Classroom Expense Deduction – Did You Know?

Eligible K-12 teachers, instructors, counselors, principals and aides who pay for classroom supplies out of pocket may deduct up to $350 of qualifying expenses per year. Married couples filing jointly who are both eligible educators may deduct up to $350 each, for a combined maximum of $700.

You do not need to itemize deductions to claim this deduction. Be sure to keep receipts and other records for any classroom expenses you plan to deduct.