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haladay · Jan 27, 2009, 02:22 PM

We have some retired missionaries that we give to on a monthly basis. Do we send them a 1099 or a 1099R? One of the retired missionaries (ordained pastor) had a problem with the IRS and had to present his case that the money he received from us was not taxable. They finally agreed. We had been submitting a 1099, but it was suggested a 1099R. Is this correct? And if so, what code is used. I have been unable to find any information and do not have an accountant to consult with. Thanks.

Fr_Chuck · Jan 27, 2009, 03:04 PM

First "who are you" a private individual, or a church group.

Is this money not considered a donation of some sort for them ?

Or is this retirement money your church is paying them?

haladay · Jan 28, 2009, 08:23 AM

We are a church. This is considered "retirement" money, as in, the church is continuing to support them voluntarily, but is not through a "retirement" fund.

AtlantaTaxExpert · Jan 29, 2009, 08:18 AM

Since it is not being done through a retirement fund, and since it is being done voluntarily, it is NOT a pension in thelegal sense, but rather a gift or donation to the individual.

For this reason, it is neither taxable to the recipient not tax deductible to the giver. If the amount exceed $13,000 annually, there MAY be a gift tax implication.

Strongly recommend you seek out the expertise of a local tax professional with experience in pension work and gift/estate tax issues.