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Question
We have just been told that my husband is consider self employed because he works at our church. He is not ordained and does not do baptizing or anything like that. He does or church music and we work with the youth. They are taking out self em. taxes now and and took away over half of his paycheck to give him a housing allowance. He did graduate this spring from La Baptist Un. Should he be considered self employed or still just a regular employee of the church? Please help.They say the laws just changed and we are curious.
Victoria,
Thanks for your question.
The laws in this regard have not changed recently.
If they are considering him to be self-employed they should not withhold any taxes from his income - it is his responsibility to make quarterly estimated payments.
He does not have to be ordained, but merely licensed or commissioned by a religious body, which can be an individual church. If he qualifies as a minister, he is considered self-employed for SS/Medicare and an employee for income tax purposes. He should receive a W-2.
The housing allowance is not subject to income tax.
Hope this helps.
John Stancil, CPA
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John Stancil, CPA
Expertise
I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I teach tax and accounting at a small church-related college. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a part time tax practice for over 35 years. I am a member of the AICPA, National Association of Tax Professionals, and the Institute of Management Accountants. Visit my website at www.johnstancilcpa.com. Also visit my blog, www.thetaxdocspot.com. Prepare and file your own taxes at www.1040stancilcpa.com
Experience
I hold a doctorate in Accounting, and four professional certifications: CPA, CMA, CGMA, and CFM. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 30 years and have taught accounting and tax at the college level for over 30 years.
Organizations
AICPA, FICPA, IMA, NATP
Publications
The CPA Journal, Florida CPA Today, Green Consumer, Green Business, Global Sustainability as a Business Imperative, Palmetto Review, NATP TaxPro Quarterly.
Education/Credentials
DBA University of Memphis
MBA University of Georgia
BS in Accounting Mars Hill College
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