Tax Deferred Retirement Account

by Jessica
(Hot Springs, AR, USA)

We have a new interim pastor who wants $19,000 cash salary, $20,000 housing allowance, and $26,000 deferred compensation.

He has set up an account with Pension Fund of the Christian Church.

I have contacted the pension fund, and it is a pre-tax 403B account that I'll need to withhold approximately $1,083.33/paycheck. (We have bimonthly payroll.) Then, I would send $2,166.66 to the pension fund every month.

My question is how do I set this up in his payroll? Would I add the $26,000 to his $19,000 cash salary and then just withhold the $1,083.33 every paycheck? Is it acceptable to do it this way or is there a better way?

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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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