Nonprofit Law/Outside travel EO


QUESTION: If a church (exempt organization) pays a guest speaker to come in and pays for that guest speakers travel expenses, do those monies need to be added to their 1099 as income?  What about meals paid for them?

ANSWER: I have in my profile that this free forum is only for general questions relating to IRS federal exemption issues of 501(c)(3) organizations. Your questions are about worker taxation which applies equally to for-profit organizations. Even though this forum is not for issues, I may be able to direct you.

The IRS categorizes workers in two ways.  They are either employees or independent contractors.  There are many factors that the IRS uses to conclude whether someone is an employee or an independent contractor and the nonprofit corporation's treatment of someone as an independent
contractor instead as an employee for tax purposes may be incorrect and subject the nonprofit organization to taxes and penalties. For the factors the IRS considers, see

But, from what you wrote, it is pretty clear that the speaker is an independent contractor.  I am assuming that you paid funds to the speaker as an individual (not to a corporation). It appears that you paid third parties for the speaker's travel expenses and meals (and did not, therefore, reimburse the speaker for money the speaker paid for such travel and meals.  If that is not correct, let me know and I will reply further.

See page 7 of which is the IRS' instructions for form 1099-Misc. You would only put on the 1099-Misc in box 7 the amounts you paid to the speaker plus the amount paid for that speaker's meals.  The meals value are included because Treas. Reg. 1.61-1(a). provides gross income includes income realized in any form, whether in money, property, or services and Treas. Reg. 1.61-2(d)(1) provides that income paid in property or services is the fair market value of the property or services.

Harvey Mechanic, Attorney at Law -

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.    

---------- FOLLOW-UP ----------

QUESTION: The speaker was paid an amount over $600 and then their travel expenses including lodging, meals & airline tickets were paid.

That is not clear as you used the passive tense "were paid".  It appears though that you are stating that the church paid third parties (not the speaker) for the lodging, meals and airline tickets.  Please let me know if that is not a correct understanding.

The IRS writes at: on page
we see:
--- Start of Excerpt ---
All of the following are considered employees for purposes of
working condition fringe benefits:  Reg. 1.132-1(b)
 Current employees
 Board of directors of the employer
 Independent contractors
Although not employees for most employment tax purposes,
independent contractors are treated as employees for this purpose
and are therefore eligible to receive nontaxable reimbursements
as working condition fringe benefits.
---End of Excerpt---

As "independent contractors" are listed there, then, if they could receive non-taxable reimbursements for certain items, then, in the alternative, if the person contracting with them pays the items, they are not then taxable to the contractor.  Otherwise, they are.

We on page 25 that air travel, lodging and meals are reimburseable, when the travel is outside of the workers tax home area.  Therefore, you would not include into the 1099s any of the amounts paid for meals, lodging or air travel for the contractor, as long as the primary purpose of the trip was for business (not for social reasons with a quick speech thrown in).

Harvey Mechanic, Attorney at Law -

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.  

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Harvey Mechanic


DO NOT GIVE ME INFORMATION THAT YOU WANT KEPT CONFIDENTIAL. I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "" without the quotes and then add your search terms before hitting enter.


I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.


B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.

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