Activity -- Tax Reimbursement

I'm kind of feeling a little uneasy about a check that I wrote today.
Each year we have a neighbor Memorial Day breakfast. We charge so much per-person and do a group family rate. Its not a budgeted activity from the ward. No church funds are really ever used (more information about that below). It is its own self sustaining activity.

Last year (my first year being ward clerk) I'm pretty sure they just took money from the money they brought in, no check was cut. We do end up depositing extra money (that we made) into an other budget to use I guess next year.

This year, the first Counselor in the bishopric brought me a reimbursement form for the food they bought. Its around $300. I wrote a check putting in the tax exempt amount (for UTAH). I wrote the check from our other Memorial Day Breakfast account (which probably only has like $30).

Was that right? I'm not sure what is the correct way of doing that? I don't think I should have written a check yet. I should have let them take money from the money they bring in tomorrow.

But even more I wouldn't think I should have entered in the UT tax amount for this type of reimbursement. I don't want the church to get into trouble for us kind of skipping paying taxes.

I could tell the first counselor to not cash the check?

I cannot answer your tax question, but I can let you know that you and your stake president will get a nice little email informing you that it is never appropriate to spend Other funds before they are collected. So you are correct that the check should not have been written because there are insufficient funds in that account.

At the very least and also not proper, if the counselor is willing to hold the check until the funds come in (hopefully today) and are deposited (which might also be today?), that would be good.

Finally, if this is not a ward activity, it should not be running through the ward financial account. And if it is a ward activity, it should be funded from the budget allowance. I would suggest a visit with the bishop and perhaps the chairman of the stake audit committee to discuss how best to handle this event in the future. It sounds as if there should be some more precise event definition, along with a reading of the Handbook section relating to financing of Church activities (if it is one) and obtaining approval from the Presidency of the Seventy if there is a need to charge for an optional activity.