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Federal Taxes

by Brad
(Illinois)

I'm the Director of Student Ministry at a United Methodist Church and I'm not currently an ordained minister.

An older pastor I know mentioned that what he did while he was working on his formal ordination was become ordained with an outisde body so he could have the tax breaks while becoming ordained.

He also mentioned that meant he didn't have Federal taxes taken out of his paychecks. I'm not sure if he explained it right to me or not.

Either way I'm thinking about going back to school to be fully ordained and wanted to know if it was a good idea for me to be ordained by an outside body (an organization that was set up to help non-denominational missionaries with ordination for tax reasons).

Am I completely off base here?

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

Comments for Federal Taxes

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Sep 26, 2010
 Classified as a Clergy for Tax Purposes
by: Vickey

I cannot advise you about being ordained by an outside body, but if you are classified as clergy for tax purposes, you are exempt from income tax withholding (although you are not exempt from paying income taxes).

You can request voluntary withholding by submitting a W-4 to your employing church.

The church cannot withhold FICA taxes as a clergy/minister pays his social security taxes through the SECA system. See this post.

This pertains to ministry-related income only.

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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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