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Clergy Mid Year Status Change ReMiX (from regular w2 employee to ordained minister)

by Cici
(Texas)

Clergy status change... Does it retro or do I prorate?

Our worship minister was ordained mid year and prior to that, fica/mc taxes were withheld. He then received 4361 approval.

Should church issue 2 (two) w2s? One for pre-minister with fica/mc withholding and another for minister exempt status?

TurboTax does not like the fact that he is a minister but still has a small amount withheld in boxes 4 & 6. HELP PLeaSe!

It would be so much simpler if the ministerial self employment status could retro to beginning of tax year but I can't find anything to verify what the IRS says.

Thanks ya'll!

Know the answer? Face the same situation? Please post your answer or comment by using the "comment" link below. Thank you!

Comments for Clergy Mid Year Status Change ReMiX (from regular w2 employee to ordained minister)

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Mar 30, 2010
 Ordained Minister-Part of the year
by: Kaye

If he was not ordained at the firs of the year, he would be a regular employee with SS & Med taxes withheld & matching taxes paid in by the church.

When he became ordained, he was under SECA - and responsible for his own self-employment taxes. He should get two W-2's. The 2nd one would only have his wages/earnings in Box 1 - but not SS or Med wages or SS or Med taxes.

If he elected to have Fed Inc Tax withheld- then there would be an entry in Box 2. If he has housing - that would have the largest impact - subject to SS & Med AND Fed Inc Tax for the 1st part of the year & only subject to self-employment taxes for the 2nd part of the year. Hope this helps!

Vickey's reply
Great answer, Kaye! Thank you!
Apr 12, 2010
 Help with Turbo Tax and Clergy change
by: Amy

Our problem is similar in that last year my husband was just a part time employee of the church and came on full time clergy January 1 2009. The church took out the social security and such when he was part time and it showed up on his last paycheck that was distributed on Jan. 5, 2009 but for the work prior to the new year. Turbo Tax will not let us efile being clergy and having information in the social security and medicare and tax withheld boxes. We only have one W-2. Do I just have to mail in the taxes instead of efile because the program will not let it go through.

Vickey's reply

I am not familiar with Turbo Tax, but it sounds like you will have to either mail it in or take your taxes to a CPA or "good" tax preparation service that could advice you on your options
Feb 16, 2013
 Two W2's
by: Debbie

I have the same situation with my son being ordained mid-year. I have been told by professionals that a church can only issue one W2 per employee. I have been searching for an answer to this for weeks! I am also using Turbo Tax and it has a problem with him having Social Security & Medicare withheld for the time prior to being ordained. Can anyone help? Please?

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Join in and write your own page! It's easy to do. How? Simply click here to return to Minister's W-2.

If you want to DIY your payroll, I highly recommend you look at using Gusto! It is very user friendly and their support is awesome! Plus they know how to set up and maintain payrolls for churches and nonprofit organizations.

Note: I am a "partner" of Gusto, but as I have told you before ... I never recommend anything that we or our clients have not tried and love =)



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