Ordained Minister part of the year

I work for a church we have a pastor that was ordained part way through 2018 does he have to pay SE taxes of the full amount of his pay? Or pay SE only after he was ordained?

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Mar 31, 2019
Meet the Criteria of Being a Minister
by: Vickey

Nonminister employees are paid under the FICA system and pay their taxes accordingly.

QUALIFYING ministers are under the SECA system and pay SE (Self-employed) taxes.

An employee is treated as a minister for payroll tax purposes if they meet the criteria for being a minister by having ministerial credentials. This can be an ordained, licensed or commissioned minister depending on the church.

I'm assuming your Pastor did not meet the criteria for being a minister for tax purposes until he was ordained.

Once he was credentialed, then he should have been treated as a minister from that time forth and his payroll at that point changed.

Hopefully you gave him 2 different W-2s or stopped matching and withholding FICA at the moment he became ordained....which meant his W-2 might have looked a little strange, but was correct anyway =)

Either way ...he only pays SE tax on the qualifying ministerial income.

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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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