ChurchTrac and Payroll for 2020

-- CHURCHTRAC PAYROLL UPDATE --

This is an update regarding our original message regarding our decision to remove the payroll module from ChurchTrac for 2020. We understand that there's some disappointment about this decision, and it was a difficult decision for us. While our Accounting screen is very popular, only a very small minority (less than 4% of our customers) are utilizing the payroll features in ChurchTrac. Payroll in general is a difficult beast that many of our users struggle with, and recently announced IRS changes for 2020 have made payroll even more complicated. Because of this, and because payroll is our most expensive and difficult feature to maintain and support, we decided to refer our payroll customers to other solutions instead of raising our prices.

With that said, we think that payroll was just a small part of what makes ChurchTrac great. ChurchTrac is a fantastic church management software that just happened to have a payroll module for the last few years. We have not lost our commitment to providing you with the best church software at the lowest possible price.

While payroll companies charge more than we were charging, most are able to offer things that we were not, including direct deposit, and filing and paying your taxes for you (including state and local taxes). In the end, we feel churches will be better served by utilizing a dedicated payroll software or service. Plus, we have been able to negotiate some discounts for you.

Our first recommendation is Patriot Software. They have both a self-serve and full service payroll option that is priced reasonably compared to others. They have the capability of handling clergy payroll tax issues, and they also have a US-based support staff to assist if you have questions or need assistance. Their prices run $10 per month, plus $4 per employee for their basic service, which is the lowest price that we have seen offered for a payroll software. For $20 more per month gets you their full service option, in which they will file all your tax paperwork for you. They offer a free trial, and when you use the link below to sign up, they'll apply a 20% discount on the prices mentioned above:

Patriot's Website

Another option would be MinistryWorks which is a payroll service specializing in churches and ministries. Their prices are a little higher than Patriot, but they should also offer you a discount if you tell them you were referred by ChurchTrac:

MinistryWorks Website

As an added bonus, both Patriot and MinistryWorks have direct deposit as well. We're also looking into ways that we can integrate or offer import options from Patriot into ChurchTrac's Accounting screen.

Please know that we care about your church and your ministry. We know this announcement may be difficult for those who were using our payroll module, but we'll do whatever we can to assist. As always, we're here to serve you however we can.

-- ORIGINAL PAYROLL NOTICE --

For several years now, ChurchTrac has offered an inexpensive way to run payroll for your ministers and employees. Unfortunately, we are going to be removing the payroll component from ChurchTrac's Accounting screen effective at the end of 2019. The following paragraphs will offer some insight into how we came to this decision, and also give you some options to help you move forward.

First, while still technically in "draft" form, the IRS is planning to make some significant changes to how payroll tax is calculated for the 2020 tax year. These changes are in response to the sweeping tax reform that was passed into law a few years ago. After reviewing the coming changes, our team has decided that the complexity of the changes will make it much more difficult for the average church to set up and run their own payroll using a self-serve product like ChurchTrac. In fact, payroll is already one of the more complex elements of our application to use, maintain and support--and the new changes would only make it that much more difficult.

While our support staff is pretty amazing when it comes to helping out, the new changes really are beyond the scope of what we're equipped to help you with. In many cases, we think it is best for churches to have a professional tax advisor to guide them, or to use a payroll service that specializes in clergy tax issues. This will be our recommendation going forward. We have seen so many churches over the last few years that have incorrectly set up their payroll, or are not doing payroll according to IRS rules and guidelines. Taxes are a complex monster, and clergy taxes are even more complicated and convoluted. In fact, sometimes even tax professionals are uneducated when it comes to clergy and church tax issues!

Just to clarify, you absolutely will be able to run payroll for the remainder of 2019 using ChurchTrac, and you'll be able generate the forms you need for 2019, even if you do that in 2020. Also, we are NOT removing any of the other Accounting screen features from ChurchTrac. The only thing that is being removed is the ability to generate payroll and print tax forms for your employees and ministers. You will still be able to enter bank transactions, balance accounts, create budgets and track fund balances. Plus, all the other ChurchTrac features outside of Accounting are still available to you as well.

You might ask, "Where do I go from here?" In the end, we feel you will be better served by utilizing a professional payroll service that has capabilities beyond what we're able to offer. There are several companies that specialize in payroll services for churches that are on currently our radar. In the coming days we plan to offer you one or more recommendations regarding these companies, and we're even working to negotiate a discount for you. We'll have more details about this soon. With that said, pretty much any payroll service you use will cost more than what you've been paying for ChurchTrac.

The choice to remove payroll was a difficult decision, but ultimately we feel it is the best decision for serving your church and the other churches that we serve. We continue to strive to provide the best product and service to you and the best possible price. If there's anything that our team can do to assist, please don't hesitate to reach out.