Clergy Disability

[Maggie]

Pastor received 3rd party disability income. The insurance premiums had been paid by the church, so I understand that the disability income is taxable to the Pastor. Assuming that the disability income is not housing allowance, is it subject to Fica/Mcare just like his regular wages? Or is disability income treated differently? Thanks!

[MAMalody]

Pastor received 3rd party disability income. The insurance premiums had been paid by the church, so I understand that the disability income is taxable to the Pastor. Assuming that the disability income is not housing allowance, is it subject to Fica/Mcare just like his regular wages? Or is disability income treated differently? Thanks!

Either the employer or the third party payor must report beneifits as salary on Form W-2, subject to the appropriate withholding requiremtns. Benefits received by a dual-status minister will be subect to social security, unless he is exempt as an individual.