Tax Season

This year, the Internal Revenue Service (IRS) tax season officially started on January 23. For tax year 2022, we want to remind you it is no longer necessary to fill out specific tax forms indicating that, as a member of a health care sharing ministry. you are exempt from the ACA mandate to have insurance. Furthermore, you are not required to claim an exemption, provide documentation of your membership, make a shared responsibility payment, or obtain an Exemption Certificate Number for your federal tax return. Please check below to see if your state has its own insurance mandate requirements.

This year’s tax donation letters (documenting your 2022 donations) were sent out on January 30, 2023.

Funds you are assigned to send to other members and to Samaritan Ministries for administrative purposes are only considered tax deductible if you are filing with the State of Missouri. We are not aware of any other state where this is the case.

Visit our Donate to Samaritan Ministries page to see ways in which you can make tax-deductible donations to the ministry.

NOTE: For information related to filing taxes for previous tax years, see the Tax Archive page.

In tax year 2022, there are special tax considerations in seven states for health care sharing ministry members.

These states include:

California
Massachusetts
Missouri
New Jersey
Rhode Island
Vermont
Washington, D.C.

Frequently Asked Tax Questions

This year’s tax donation letters (documenting your 2022 donations) were sent out on January 30, 2023. The tax deduction letters (sent only to State of Missouri residents) were sent by postal mail on Friday, February 3.

Note: Funds you are assigned to send to Samaritan Ministries or to other members of Samaritan Ministries are not considered a tax-deductible donation at the federal level or at the state level. At the present time, funds you send to other members are only considered a tax-deductible expense if you are filing with the State of Missouri.

No. As far as we are aware, the IRS does not consider funds you send to other members as an itemized personal deduction on Schedule A.

In the past, we have seen that claiming medical bills for which funds were received has caused members to have an issue with the IRS. We recommend conferring with your tax adviser before doing so.

No. While Samaritan Ministries is recognized by the IRS as an exempt charity, only donations given beyond the administrative fees and monthly funds you are assigned to send other members are deductible as a charitable gift.

As far as we are aware, the IRS has never considered the receipt of funds from other Samaritan members to help pay your medical bills as income.

There are many friends of health care sharing ministries in Congress who want clarification and changes in the tax laws that would be beneficial to our members. There is a good chance for such changes to occur with the help of our members contacting their representatives in Congress. We will notify our members when we need their help contacting their representatives.

If you received Shares in your PayPal account that were accidentally sent via Goods and Services rather than Friends and Family, you may receive a 1099-K detailing the amount of these transactions. On December 23, 2022, the Internal Revenue Service (IRS) announced that they are delaying the 1099-K change that would require a lower threshold of Goods and Services reporting ($600 annual limit rather than the previous $20,000).

You should only receive a 1099-K if you receive more than $20,000 in Goods and Services transactions. No member has reported having this occur to them due to Shares sent improperly.  Please see the link below for more information on this implementation delay. 

https://www.irs.gov/newsroom/i...

Note: Member Shares are gifts from one person to another and the IRS has never considered the receipt of Shares as income.  

As detailed in the FAQ excerpt from the IRS below, the 1099-K is not the IRS making a declaration on the taxability of those dollars, but merely showing the funds sent to your PayPal account via Goods and Services. You can find the full article here:

https://www.irs.gov/businesses/understanding-your-form-1099-k

What does my Form 1099-K report to me?

Form 1099-K includes the gross amount of all reportable payment transactions. You will receive a Form 1099-K from each payment settlement entity from which you received payments in settlement of reportable payment transactions. A reportable payment transaction is defined as a payment card transaction or a third-party network transaction.

• Payment card transaction means any transaction in which a payment card, or any account number or other identifying data associated with a payment card, is accepted as payment.

• Third party network transaction means any transaction that is settled through a third-party payment network, but only after the total amount of such transactions exceeds the minimum reporting thresholds.

The gross amount of a reportable payment does not include any adjustments for credits, cash equivalents, discount amounts, fees, refunded amounts, or any other amounts. The dollar amount of each transaction is determined on the date of the transaction.

Note: The minimum reporting thresholds apply only to payments settled through a third-party network; there is no threshold for payment card transactions.

You can access additional information at the IRS 1099-K FAQ found at the link below:

https://www.irs.gov/payments/form-1099-k-frequently-asked-questions

Please confer with your tax adviser about the proper way to navigate the situation if you receive a 1099-K due to Shares being sent incorrectly.  

If you have general questions regarding health care sharing ministries and taxes,
please contact us at taxquestion@samaritanministries.org. For more specific tax questions,
please consult your tax adviser.

The above is provided as an informational service only for our members and is not tax advice.
For tax advice, please contact your tax adviser.