Example Pastor's W-2

by Ron

Why isn't the HA(6000) subtracted from salary when calculating the amount for Box 1?
It's indicated elsewhere that it should be.

Vickey's reply: The $6,000 is a Social Security Allowance and is fully taxable to the recipient.

Some churches give their ministers additional pay to help with the minister being fully responsible for his Social Security and Medicare tax and that is perfectly legal; however, it is also fully taxable on an income level and SS level (if the minister has not opted out of SS).

Most "allowances" such as a SS Allowance and a car allowance is fully taxable and will be reported in Box 1 of a W-2, except for the housing allowance.

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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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