Q: Who is ultimately responsible for a church that pays employment taxes? The treasurer or the board members who run the c
This small church treasurer had no experience with taxes. She was handed the position because none of the elders or decons wanted it. No 941s were files since 2015, 4th quarter. She has since left the church. The back taxes have been paid by the church. The penalties & interest are over $20,000. The board has threatened to go after the former treasurer. How liable is the former treasurer for this money? She is currently a full-time caregiver for her elderly parents, including severe dementia. She has nothing. She requested assistance from the board every quarter, and though she was told she would receive aid, none was forthcoming. The church does have enough money to cover this amount in total, in various CDs, and other bank accounts.
A:
In situations involving the mishandling of employment taxes by a church or any organization, the responsibility generally falls on the entity itself, including its board or governing body, rather than on an individual member or officer such as the treasurer. However, the specific legal and financial liability of an individual can vary based on their role, actions, and the organizational structure of the church. The treasurer, while involved in financial management, typically acts under the guidance and direction of the church's board or leadership team.
The former treasurer's liability for the penalties and interest due to the non-filing of Form 941s would depend on various factors, including the governance policies of the church, the level of authority and responsibility granted to the treasurer, and any evidence of negligence or willful misconduct. Given the treasurer's lack of experience and the absence of support she claimed to have requested, determining her personal liability may involve a complex legal assessment. It's also relevant to consider whether the board had a duty to oversee the treasurer's work and ensure compliance with tax obligations.
If the church faces financial penalties and is considering holding the former treasurer accountable, it would be prudent for all parties involved to seek legal counsel. A legal professional can offer guidance on the matter, including the potential for personal liability and the most appropriate course of action to resolve the situation. The focus should ideally be on addressing the issue with understanding and fairness, considering the former treasurer's circumstances and her efforts to seek help from the church leadership.
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