Clergy pay SE for housing allowances, but I have a minister who has not filed 4361 that insists he should not pay se tax. Am I missing anything?
I prepare many clergy returns and do not know of any other way to be exempt except 4361.
Mt Juliet CPA
i also prepare clergy returns and they have to pay SSN taxes on the houseing allowance if they did not file 4361. They ALL bawl and scream
I agree members of the clergy must pay self-employment tax on services performed unless they elect out on form 4361.
Pull out your handy dandy Pub 17, turn to page 48, 3rd column, last paragraph: "Special rules for housing apply to members of the clergy...you must include the rental value of the home or the housing allowance as earnings from self-employment on Schedule SE".
The minister you're dealing with probably has had so much conflicting advice on what's taxable and what's not that he's decided to go with what seems to make the most sense to him (or her).
You might want to add that you are not willing to prepare a return which you know is not in compliance with the law.
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