I was recently reminded about this important topic during a session with Frank Sommerville, a leading nonprofit attorney. Are musicians, even if they are only used for special events, independent contractors or employees?
In a blog that Frank wrote this year, he identified two organizations that reached the conclusion that musicians are employees of the organization engaging them.
Several years ago, my church went through and changed the status of all our musicians and performers from independent contractors to employees after I read the IRS rules outlining the qualifications of an independent contractor.
While I certainly got some pushback, our decision aligns with the more recent cases affirming that most musicians and performers engaged by ministries are employees, even if they only perform for the Easter or Christmas program.
If you think you might need to make same changes, be sure to look into the IRS’ Voluntary Worker Classification Program, which allows your organization to reclassify these employees with a minimal payment to cover past payroll obligations. (There’s more information on this topic in my blog from November 15, 2011.)
How has your ministry handled this issue? Any difficulty in your decisions?