It's not uncommon for churches to strategically leverage the use of contractors throughout their organization. When done properly, they can produce significant value while also adding some serious cost savings. You'll most commonly see these used in worship ministry such as musicians, sound engineers, and video producers; however, more and more churches are using them for areas that used to be filled by in-house employees. We're seeing more and more contractors execute areas of IT, administration, and of course, finance.
In this pursuit of efficiency or cost savings, we're also seeing more churches replace employees with contractors without considering how the IRS would classify these types of individuals. If a church misclassifies an individual, then you may be held liable for that work for the duration in which this individual was classified improperly. In other words, it's worth taking a look at whether you're classifying individuals as employees or contractors and getting it right on the front end.
Here's a quick test we created to help you determine how a particular individual should be classified.