Clergy W-2 with amounts in boxes 3,4,5,6

[photoman]

Clergy W-2 with amounts in boxes 3,4,5,6



I have an ordained Minister with a W-2 and it has amounts in boxes 3,4,5 and 6. This is the first clergy I have done in a long time, but in reading regs on it , looks like box 3 to 6 should be empty . Any ideas what I should do. Also should theW-2 have a clergy code P in it

Any help would be appreciated

Thanks, Ron

[rtsietsema]

Boxes can have amounts

Clergy are a special breed. Some churches choose to pay the pastor only a wage and will withhold Federal or State taxes on request, but do not wish to deal with FICA etc. I've seen some with a number in box 1 only! Others will pay FICA for the pastor and you will see amounts in those boxes. Depending on your software, you need to treat this as just an ordinary W-2, and these wages will not be subject to additional SE taxes.

I have one this year who moved to a new church. One church withheld FICA that other did not. I just needed to be sure those wages flowed onto the SE calculations, along with his housing allowance and SE income from pastoral acts.

Be sure to check into housing allowance paid or a parsonage supplied, pastoral acts, etc. Also check how your software moves them to other forms to calculate credits etc. Sometimes software has a glitch in it for this situation, since clergy returns are specialized.

[RitaB]

Yeah, they're special

Clergy are a special breed. Some churches choose to pay the pastor only a wage and will withhold Federal or State taxes on request, but do not wish to deal with FICA etc. I've seen some with a number in box 1 only! Others will pay FICA for the pastor and you will see amounts in those boxes.

Churches are not supposed to withhold SS/MC from pastor wages. It's very common to see amounts in Box 1 and Box 14 (housing allowance) only. Some pastors have the church withhold income tax, so you'll have an amount in box 2.

https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Members-of-the-Clergy

At this late date, I'd postpone the seminar to the church and the preach until after tax season and just do the return like he was a regular employee.

[rtsietsema]

Agreed

Churches are not supposed to withhold SS/MC from pastor wages.

I agree with RitaB, churches are not supposed to w/h FICA, clergy are subject to SECA rules. Unfortunately as we all know, not everyone gets it right and we have to deal with what we have. As stated, treat it like a regular W-2, and then have a discussion later. Just like I have the discussion that housing allowance forms are filled out in advance of the tax year, not after.

Part of our job is education.

[RitaB]

Just like I have the discussion that housing allowance forms are filled out in advance of the tax year, not after... Part of our job is education.

Yes, and it's sooooooo hard to get churches and pastors to do things correctly. At least here it is. "I have the receipts for everything."

"Yes, and they are very nice receipts. Just look at those receipts. And the church STILL has to approve the HA in advance of paying it, and I STILL need fair rental value and actual utilities separated from your light bulbs and new couch..." Sigh.

[photoman]

Thanks To All,
Ron

[MAMalody]

Don't forget that if he is a regular employee he does not qualify for the housing allowance. Get a corrected W-2 if this is the case.

[photoman]

Thants for the information. He is a Teen Minister

Ron