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Procedure Name:Working with Reliant as a Commissioned or Ordained Minister
Scope:All Staff
Revision Date:January 26, 2024
Last Review Date:January 26, 2024


Note

Please review

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the process of claiming your status as a commissioned or ordained minister in relation to your work with Reliant.

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You are not required to claim your work as a commissioned/ordained minister to your work with Reliant. When you submit your certificate, your tax status is immediately changed and cannot be reverted unless your job role changes where you are no longer performing ministerial services. 


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title1. Educate yourself on the tax implications


UI Steps


UI Step

Read the ECFA

Understand the tax implications

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Minister's Tax and Financial Guide

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Consult a tax professional

.

https://www.fcmmbenefits.org/ministers-tax-financial-guide-2024-2023-tax-returns

  • Ministers are granted the ability to seek an exemption from Social Security if they meet IRS requirements. 
  • An exemption results in ceasing contributions to and eligibility for both Social Security (government retirement protection as well as other assistance programs) and Medicare (government medical insurance for people with disabilities and people over 65). 
  • By default, ministers remain in the Social Security system and are required to continue making payments directly to the IRS for their Social Security/Medicare coverage (see details below). 


UI Step

Consult a tax professional.

Reliant is unable to offer tax advice for your specific situation, so we

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strongly encourage you to talk with a professional who is up-to-date on current

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practices and understands ministerial tax implications. You are eligible for taxable reimbursement of some tax preparation and advisory fees.

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Tax options governed by the IRS and Social Security related to Parsonage (Minister's Housing Allowance) and Social Security Exemption

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are available to licensed/ordained

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/commissioned ministers.

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Know your reporting responsibility and the consequences of choosing these options.


UI Step

Understand your

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IRS employment status

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related to your commissioned/ordained status.

 

The IRS classifies

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commissioned/ordained ministers into two categories

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:

  1. Related to Federal Income Tax, you are employed by

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  1. Reliant. Reliant withholds and pays Federal Income Tax on your behalf and sends you a W-2.
  2. Related to Social Security and Medicare, you are self-employed. Reliant stops

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  1. withholding FICA taxes and paying the employer portion on your behalf. FICA tax includes portions for Social Security and Medicare, and the tax rate is 15.3%

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  1. , which you are still obligated to pay

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  1. unless you receive an exemption from the government. If you

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  1. participate in the Social Security system, you

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  1. file SECA forms with your tax return.

Resource: Chapter 6 in Zondervan Minister's Tax and Financial Guide 

Make a well-informed decision about Social Security

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Highlights: 

  • Ministers are granted the ability to seek an exemption from Social Security if they meet certain requirements.
  • By default, you will remain in the system. A decision to seek exemption must be based on conscience, not convenience. You must be morally opposed to acceptance of insurance from government assistance programs like Social Security, Medicare, Medicaid, food stamps, housing assistance, unemployment assistance, disability assistance, etc. You cannot make the decision to seek an exemption simply because you think you can achieve a better investment return on those funds elsewhere (economic reasons).
  • An exemption results in ceasing contributions to and eligibility for both Social Security (retirement protection as well as other assistance programs) and Medicare (medical insurance for those over 65 and disabled). 
Warning
Reliant is not able to assist you with this decision. It is a completely personal decision. You may also want to talk with other ministers who have dealt with this option. 


UI Step

Decide if you want to stay in the Social Security System.

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titleStay in the Social Security System

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If you

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decide to stay in the Social Security system, you are eligible to receive a 7.65% FICA bonus to offset your tax obligation for Social Security that was previously paid by Reliant. This bonus increases your monthly salary and is included in your monthly paycheck.

Note

Remember, you must begin to pay your own Social Security/Medicare tax (now called SECA since you are considered self-employed) from the point in time that you are paid Reliant wages as a minister.

See Paying SECA Taxes for more information. Review Chapter 7 in Zondervan Minister's Tax and Financial Guide and research options for paying SECA to the IRS.

https://www.fcmmbenefits.org/ministers-tax-and-financial-guide-2023-2022-returns



UI Expand
titleOpt Out of the Social Security System

File Form 4361 with the IRS

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. Reliant may request an electronic copy of the Minister's IRS-approved Form 4361 for our records as a safeguard for the employee and Reliant as an employer if ever needed by the IRS regarding the minister's tax status.

A minister is fully responsible for paying social security/medicare taxes (SECA) until the IRS sends a certificate verifying that the exemption request has been granted. See Claiming Exemption from Social Security Taxes for more information. 



Warning
Reliant is not able to provide counsel in this tax decision and cannot assist in filing forms with the IRS. It is a personal decision that each minister must decide based on their own convictions.  

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UI Step

Understand and plan your Parsonage Allowance

Parsonage allowance, also called housing allowance, is one of several special tax benefits applied to qualified ministers. Read the following page to learn about parsonage and begin thinking about the amount you may wish to designate to parsonage: Parsonage




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title2. Notify Reliant of Your Commissioning/Ordination and Your Tax Decisions

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By submitting your certificate to Reliant, you are choosing to apply your new tax status to your work with Reliant

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. Once you submit your certificate, we must immediately change your tax status

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to no longer withhold FICA taxes. Once this change is made, we can not revert the tax settings unless the Minister has a job role change in which they are no longer performing ministerial services.

Helpful Solomon page regarding certificate requirements - Commissioned, Licensed and/or Ordained Minister Certificate Requirements

If you would like to claim your work with Reliant as that of a Commissioned/Ordained Minister, proceed to the next section.

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Notify Reliant of your Commissioning/Ordination and your Tax Decisions

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Otherwise, no further action is necessary.

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UI Steps


UI Step

Email a copy of your certificate

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Whom to email: benefits@reliant.org

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and let us know your tax decisions to payroll@reliant.org. A Reliant director will review the certificate. Once approved, you will be notified, and your tax settings will be changed

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.

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UI Expand
titleStay in the Social Security System

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Decide if you would like to take the FICA Bonus 

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If you inform us that you are staying in the Social Security system, you will receive a 7.65% FICA bonus to offset your tax obligation for Social Security that was previously paid by Reliant. This bonus increases your monthly salary and is included in your monthly paycheck.

Details: Once Reliant receives notification that you would like the bonus, you will receive a new salary offer. 

  • Ministers who communicate their decision to Reliant to remain in the social security system within 3 months of communicating their ordination/commissioning to Reliant will be eligible for the 7.65% FICA Bonus retroactively to the time period they began receiving Reliant wages as a minister. 

  • Ministers who communicate this decision to Reliant anytime after 3 months will be eligible for the 7.65% FICA bonus beginning with the next available pay date. (You will only be eligible for up to 3 months of retroactive FICA bonus and must request that in your email.) 

Whom to email: benefits@reliant.org

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Research options for paying SECA to the IRS

Note

Remember, you must begin to pay your own Social Security/Medicare tax (now called SECA since you are considered self-employed) from the point in time that you are paid Reliant wages as a minister.

See Paying SECA Taxes

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 for more information

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. Review Chapter 7 in Zondervan Minister's Tax and Financial

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Guide and research options for paying SECA to the IRS.

https://www.fcmmbenefits.org/ministers-tax-financial-guide-2024-2023-tax-returns



UI Expand
titleOpt Out of the Social Security System

If you have an exemption from Social Security,

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email payroll@reliant.org stating, “I am exempt from the Social Security System because I am conscientiously opposed to receiving public insurance as a minister.”

Whom to email: benefits@reliant.org

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This is the official statement employers are required to collect as an assurance that the minister is properly informing their employer, Reliant, of their tax decisions as a minister.  

In some cases, Reliant may also request an electronic copy of the Minister's IRS-approved Form 4361 for our records.  The collection of this form is a safeguard for the employee and Reliant as an employer, to ensure Reliant has an electronic copy saved to our records if ever needed as a part of interactions with the IRS regarding their minister's tax status.


UI Step

Once you receive our email that your Certificate and tax decision has been processed, please submit a new Support Goal in TOOLBOX https://toolbox.reliant.org/account/sign-in?return=%2Fsupport-goals

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titleStay in the Social Security System

You will see your minister status reflected on your support goal. Make sure to select "no" to having opted out of Social Security. 


UI Expand
titleOpt Out of the Social Security System

You will see your minister status reflected on your support goal. Make sure to select "yes" to having opted out of Social Security. 


UI Step

Complete a Parsonage Request form if you wish to receive Minister's Housing Allowance (Parsonage)

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. 

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Once your parsonage amount

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is approved, it

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becomes effective on the next applicable pay period. To change your parsonage amount in the future,

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complete a new Parsonage Request form and share it

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with payroll@reliant.org for approval. Dave Meldrum-Green, our director of Organizational Affairs & treasurer, reviews and approves all parsonage requests.

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Reference Chapter

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4 in Zondervan Minister's Tax and Financial

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Whom to email: benefits@reliant.org

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4. Submit a new Support Goal

Details: Make sure to wait to submit a new Support Goal until you have received confirmation that your bonus request has been processed.

Submitting a new Support Goal accepts and activates the bonus.

Resource: Support Goal on Staffnet

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5. Submit an updated job description

Guide for details on Ministerial Housing Allowance. 

https://www.fcmmbenefits.org/ministers-tax-financial-guide-2024-2023-tax-returns


UI Step

Contact your Program Team Liaison to submit a new job description

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reflecting your responsibilities as a commissioned or ordained minister.

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Resource: Job Description

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Additional Resources



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