Tax Form Reporting

Form 941

Clergy are reported on form 941, but only in the following places.

Item 1 asks for “number of employees”. Clergy are employees, so they would be included in that count.

Item 2 asks for “wages, tips, and other compensation”. Clergy’s wages are included in this total. Remember to include only taxable wages though; unreimbursed business expenses and housing allowances are not included.

Item 3 asks for “total income tax withheld”. Any federal taxes withheld from clergy wages would be included here.

Items 5a and 5c ask for “taxable social security wages” and “taxable Medicare wages”. Clergy are exempt from these items, so their wages should not be included in these two items.

W-2, Wage and Tax Statement

Clergy receive a W-2 at the end of the year, like all other employees. Because of their unique status, the form needs to be filled out differently.

Box 1, Wages, tips, other compensation: The clergy’s taxable wages would be reported in this box.

Box 2, Federal income tax withheld: Any federal taxes that were withheld from the clergy’s paychecks should be reported here.

Boxes 3-6: These boxes relate to Social security and Medicare taxes. Since clergy are exempt from this, these boxes should be blank.

Box 14, Other: If the clergy is getting a housing allowance, this should be reported here.