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Author Topic: Should you get a W2 or a 1099 from your church?  (Read 6834 times)

Offline MrSparrow

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Should you get a W2 or a 1099 from your church?
« on: February 09, 2007, 10:47:11 AM »
I've done some research and I've come to the conclusion that church musicians who play at the same church and recieve the same weekly or monthly pay should NOT get a 1099.

If you work at only one church and you play there exclusively on using "THE CHURCH'S PIANO/KEYBOARD/ORGAN/DRUMS" and not your own personal equipment only you are an employee of the church.

If you need an example, here's one for you...

If I came to your church this year and did a one weekend workshop/concert, at the beginning of 2008 I should get a 1099 form from your church stating how much I was paid. Since that was a one weekend workshop/concert and since I do many other workshops with other churches, I am a self employed/independant contract worker. If I did workshops/concerts with other churches and charged the same fee for that ONE TIME fee, I am not a employee of the church. I actually work for myself. I set my own schedule, I set my own rehearsals, I book my own concerts and no church tells me when I can or can not do my workshops/concerts.

If you work exclusively at your church every service, every Sunday
If you work and recieve the same pay every week and get paid every two weeks (regular pay period)
If you can fire me anytime you want
If you can only work exclusively on the church property (choir rehearsals, services)
If you can quit anytime you want without any liability


Don't take my word for it but see what the IRS says about it.


2. Employee or Independent Contractor?
An employer must generally withhold federal income taxes, withhold and pay social security and Medicare taxes, and pay unemployment tax on wages paid to an employee. An employer does not generally have to withhold or pay any taxes on payments to independent contractors.

Common-Law Rules
To determine whether an individual is an employee or an independent contractor under the common law, the relationship of the worker and the business must be examined. In any employee-independent contractor determination, all information that provides evidence of the degree of control and the degree of independence must be considered.

Facts that provide evidence of the degree of control and independence fall into three categories: behavioral control, financial control, and the type of relationship of the parties. These facts are discussed below.

Behavioral control.   Facts that show whether the business has a right to direct and control how the worker does the task for which the worker is hired include the type and degree of:

Instructions that the business gives to the worker.   An employee is generally subject to the business' instructions about when, where, and how to work. All of the following are examples of types of instructions about how to do work.
When and where to do the work.

What tools or equipment to use.

What workers to hire or to assist with the work.

Where to purchase supplies and services.

What work must be performed by a specified individual.

What order or sequence to follow.

  The amount of instruction needed varies among different jobs. Even if no instructions are given, sufficient behavioral control may exist if the employer has the right to control how the work results are achieved. A business may lack the knowledge to instruct some highly specialized professionals; in other cases, the task may require little or no instruction. The key consideration is whether the business has retained the right to control the details of a worker's performance or instead has given up that right.

Training that the business gives to the worker.   An employee may be trained to perform services in a particular manner. Independent contractors ordinarily use their own methods.

Financial control.   Facts that show whether the business has a right to control the business aspects of the worker's job include:

The extent to which the worker has unreimbursed business expenses.   Independent contractors are more likely to have unreimbursed expenses than are employees. Fixed ongoing costs that are incurred regardless of whether work is currently being performed are especially important. However, employees may also incur unreimbursed expenses in connection with the services that they perform for their business.

The extent of the worker's investment.   An independent contractor often has a significant investment in the facilities he or she uses in performing services for someone else. However, a significant investment is not necessary for independent contractor status.

The extent to which the worker makes his or her services available to the relevant market.   An independent contractor is generally free to seek out business opportunities. Independent contractors often advertise, maintain a visible business location, and are available to work in the relevant market.

How the business pays the worker.   An employee is generally guaranteed a regular wage amount for an hourly, weekly, or other period of time. This usually indicates that a worker is an employee, even when the wage or salary is supplemented by a commission. An independent contractor is usually paid by a flat fee for the job. However, it is common in some professions, such as law, to pay independent contractors hourly.

The extent to which the worker can realize a profit or loss.   An independent contractor can make a profit or loss.

Type of relationship.   Facts that show the parties' type of relationship include:
Written contracts describing the relationship the parties intended to create.

Whether or not the business provides the worker with employee-type benefits, such as insurance, a pension plan, vacation pay, or sick pay.

The permanency of the relationship. If you engage a worker with the expectation that the relationship will continue indefinitely, rather than for a specific project or period, this is generally considered evidence that your intent was to create an employer-employee relationship.

The extent to which services performed by the worker are a key aspect of the regular business of the company. If a worker provides services that are a key aspect of your regular business activity, it is more likely that you will have the right to direct and control his or her activities. For example, if a law firm hires an attorney, it is likely that it will present the attorney's work as its own and would have the right to control or direct that work. This would indicate an employer-employee relationship.

The American Guild of Organists say the same here:

NOTE: Occasionally churches or synagogues will hire musicians as independent contractors instead of employees. According to the IRS, workers are generally considered employees if they:

Must comply with the employer's instructions about the work.

Receive training from or at the direction of the employer.

Provide services that are integrated into the business.

Provide services that must be rendered personally.

Are aided by assistants who are hired, supervised, and paid by the employer.

Have a continuing working relationship with the employer.

Must follow set hours of work.

Work full-time for an employer.

Do their work on the employer's premises.

Must do their work in a sequence set by the employer.

Must submit regular reports to the employer.

Receive payments of regular amounts at set intervals.

Receive payments for business travel expenses.

Rely on the employer to furnish tools and materials.

Lack a major investment in the facilities or equipment used to perform the services.

Cannot make a profit or suffer a loss from their services.

Work for one employer at a time.

Do not offer their services to the general public.

Can be fired by the employer.

May quit work at any time without incurring liability.

According to these guidelines, the majority of church and synagogue musicians are employees.


Offline 4hisglory

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Re: Should you get a W2 or a 1099 from your church?
« Reply #1 on: February 09, 2007, 10:57:17 AM »
But the musician can still be considered an Indpendent contractor.  Just because the musician works a set schedule doesnt make him an employee.
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