Odd clergy situation-MMalody please help!

[joanmcq]

Longtime client is a priest with a small breakoff Catholic denomination. He has taken a vow of poverty, and gives much of his income to the community.

In past years he's had the presiding bishop write the letter for the amount he's donated to the order. He was just ordained presiding bishop. So who writes the letter?

Also, he takes no salary or housing allowance from the church; he has a pension from his former work. His home is essentially the parish house in town. If out-of-town clergy visit, that is where they stay. He has a chapel in his house. What, if any, way is there to document the use of his home?

He's also had several trips this year, one to the Phillipines and Japan to visit parishes there and to speak at the Roman Catholic University and at Byzantine Rite churches. He also stayed over to visit relatives in Japan (personal). Is this deductible as charitable? Who makes the decision since he is in charge of the US denomination?

[Burke]

You say he has a pension from his former work -- no other income? So I am surmising this is the taxable income he is donating from? If the house is provided by the church, what does he have to document the use of it for? The trips sound like business trips for the church or diocese, rather than charitable, so since there is no income from the church or order, no deductible business expense either. Is he paying for these trips out of his own funds? The letter for documenting the donations could be provided by the person to whom the funds are accountable. Perhaps a secretary or financial committee chairman of the order. Someone must be accounting for donations somewhere and paying out the funds for charitable purposes.

[joanmcq]

He has a pension and social security. He owns the house. And yes, it is taxable income he is donating.

[erchess]

Observation

There may be a committee that oversees the books but it wouldn't surprise me if there's not. Assuming there isn't and he has the full authority of the denomination to do so, why can't he just prepare and sign all the documents the former Bishop did and those he always signed when he was a Priest? After all, a very small corporation might find one person (conceivably the only owner) signing documents to create an accountable plan and other documents to say he is asking for and is approved to get reimbursements under the accountable plan. All you really need to be sure of is that no one signs anything that he is not properly authorized to sign.

However I'd also like to have Mike weigh in on this.

[MAMalody]

Hmmm. There have been some good responses here. Here is what I see:

1. The past bishop got his information from somewhere to give the charitable contribution statement I would suggest to have that individual provide that statement under his name. Failing that, if he is doing the work himself, have him issue a document to himself under his name.

2. I am not sure how you could do anything about the house being used for some church uses. This would also appear to be a diminimus use of the house and any effort to try to carve out a deductible portion would probably not be worth the effort. Of course, any direct expense he is able to identify would be deductible or possibly should be reimbursed by the church.

3. In reference to the trips, they appear to be business trips for the church and, as such, should be paid for/reimbursed by the church.

[Lion]

Bylaws

Check the bylaws to see if they say he can or cannot authorize reimbursements to himself, or if he needs a second signature, or if amounts over a specific amount need a second signature. Same for acknowledgements. Are there elected officers, a treasurer, etc. or a hired administrator?