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Pub. 517, Social Security & Other Information for Members of the Clergy 2005 Tax Year

Publication 517 - Introductory Material


What's New

Increased contribution limits for traditional and Roth IRAs. The contribution limit to your traditional or Roth IRA for 2005 is $4,000 ($4,500 for people age 50 or older by the end of the year).

Reminder

Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

Introduction

Social security and Medicare taxes are collected under two systems. Under the Self-Employment Contributions Act (SECA), the self-employed person pays all the taxes. Under the Federal Insurance Contributions Act (FICA), the employee and the employer each pay half of the taxes. No earnings are subject to both systems.

Table 1. Are You Covered Under FICA or SECA?

Find your occupation in the left column and read across the table to find if you are covered under FICA or SECA. Do not rely on this table alone. Also read the discussion for your occupation in the following pages.
Occupation Covered under FICA? Covered under SECA?
Minister NO. You are exempt.* YES, if you do not have an approved exemption from the IRS.

NO, if you have this exemption.*
Member of a religious order who has not taken a vow of poverty NO. You are exempt.* YES, if you do not have an approved exemption from the IRS.

NO, if you have this exemption.*
Member of a religious order who has taken a vow of poverty YES, if:
  • Your order elected FICA coverage for its members, or

  • You worked outside the order and the work was not required by, or done on behalf of, the order.



NO, if neither of the above applies.*
NO. You are exempt.*
Christian Science practitioner or reader NO. You are exempt.* YES, if you do not have an approved exemption from the IRS.

NO, if you have this exemption.*
Religious worker (church employee) NO, if your employer elected not to have you covered. YES, if your employer elected not to have you covered under FICA.

NO, if you are covered under FICA.
Member of a recognized religious sect YES, if you are an employee and do not have an approved exemption from the IRS.

NO, if you have this exemption.
YES, if you are self-employed and do not have an approved exemption from the IRS.

NO, if you have this exemption.

* The exemption applies only to qualified services as defined later under Qualified Services.

Table 1. Are You Covered Under FICA or SECA?

Find your occupation in the left column and read across the table to find if you are covered under FICA or SECA. Do not rely on this table alone. Also read the discussion for your occupation in the following pages.
Occupation Covered under FICA? Covered under SECA?
Minister NO. You are exempt.* YES, if you do not have an approved exemption from the IRS.

NO, if you have this exemption.*
Member of a religious order who has not taken a vow of poverty NO. You are exempt.* YES, if you do not have an approved exemption from the IRS.

NO, if you have this exemption.*
Member of a religious order who has taken a vow of poverty YES, if:
  • Your order elected FICA coverage for its members, or

  • You worked outside the order and the work was not required by, or done on behalf of, the order.



NO, if neither of the above applies.*
NO. You are exempt.*
Christian Science practitioner or reader NO. You are exempt.* YES, if you do not have an approved exemption from the IRS.

NO, if you have this exemption.*
Religious worker (church employee) NO, if your employer elected not to have you covered. YES, if your employer elected not to have you covered under FICA.

NO, if you are covered under FICA.
Member of a recognized religious sect YES, if you are an employee and do not have an approved exemption from the IRS.

NO, if you have this exemption.
YES, if you are self-employed and do not have an approved exemption from the IRS.

NO, if you have this exemption.
* The exemption applies only to qualified services as defined later under Qualified Services.

This publication covers the following topics about the collection of social security and Medicare taxes from members of the clergy and religious workers.

  • Which earnings are taxed under SECA and which under FICA. (See Table 1 to determine whether FICA or SECA applies.)

  • How a member of the clergy (minister, member of a religious order, or Christian Science practitioner) can apply for an exemption from self-employment tax.

  • How to figure net earnings from self-employment.

This publication also covers certain income tax rules of interest to the clergy.

A comprehensive example shows filled-in forms for a minister who has income taxed under SECA, other income taxed under FICA, and income tax reporting of items specific to the clergy.

set of worksheets
New this year to Publication 517 is a set of worksheets that you can use to figure the amount of your taxable ministerial income and allowable deductions. You will find these worksheets near the end of the publication, right after the Comprehensive Example.

Note.

In this publication, the term “church” is generally used in its generic sense and not in reference to any particular religion.

Comments and suggestions.   We welcome your comments about this publication and your suggestions for future editions.

  You can write to us at the following address:


Internal Revenue Service
Individual Forms and Publications Branch
SE:W:CAR:MP:T:I
1111 Constitution Ave. NW, IR-6406
Washington, DC 20224

  We respond to many letters by telephone. Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence.

  You can email us at *taxforms@irs.gov. (The asterisk must be included in the address.) Please put “Publications Comment” on the subject line. Although we cannot respond individually to each email, we do appreciate your feedback and will consider your comments as we revise our tax products.

Tax questions.   If you have a tax question, visit www.irs.gov or call 1-800-829-1040. We cannot answer tax questions at either of the addresses listed above.

Ordering forms and publications.   Visit www.irs.gov/formspubs to download forms and publications, call 1-800-829-3676, or write to the National Distribution Center at the address shown under How To Get Tax Help in the back of this publication.

Useful Items - You may want to see:

Publication

  • 54 Tax Guide for U.S. Citizens and Resident Aliens Abroad

  • 525 Taxable and Nontaxable Income

  • 529 Miscellaneous Deductions

  • 535 Business Expenses

  • 590 Individual Retirement Arrangements (IRAs)

  • 596 Earned Income Credit (EIC)

Form (and Instructions)

  • SS-8
    Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding

  • SS-16
    Certificate of Election of Coverage Under the Federal Insurance Contributions Act

  • Schedule SE (Form 1040)
    Self-Employment Tax

  • 1040-ES
    Estimated Tax for Individuals

  • 1040X
    Amended U.S. Individual Income Tax Return

  • 4029
    Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits

  • 4361
    Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders and Christian Science Practitioners

Ordering publications and forms.   See How To Get Tax Help, near the end of this publication, for information about getting these publications and forms.

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