Barbara Holmes, CPA, CFP, MS, LLC | Serving the Community for Decades …
What to expect when correcting improper FICA withholdings for a pastor.
Wages paid to ministers are not included in the definition of wages for the purposes of withholding FICA/Medicare tax . This includes the related employer matching of these taxes by the church.
Instead, ministers must pay into the Social Security/Medicare systems through self-employment tax calculated on Schedule SE with their personal tax returns (unless they obtain an exemption ).
Barbara Holmes, CPA, CFP, MS, LLC | Serving the Community for Decades …