Speaking with Pastor Simpson during the break, he informed me no one in his Church received a salary, including him. Therefore, some of the information in the class did not apply to him. I asked him if the Church had ever offered him a salary, to which he replied, “Yes, but I refused it.” Questioning him further on this I realized he could be in serious trouble because of a little known Treasury Regulation.
I informed Pastor Simpson that the IRS may very well tax him on the compensation he turned down. This information shocked the Pastor in such a manner he became very anxious. Then I explained why.
It was only a few months later that Pastor Simpson relayed the news of which I was concerned he would hear. He had to pay taxes on the income he had turned down and was hit with additional penalties and interest.