Q&A: Conscientious Objection to Social Security

When can a minister file form 4361?

Michael E. Batts, CPA
Bio
My son sold his home in December 2006. In 2007 he and his wife were accepted by a mission board as missionary candidates. In 2007 and 2008 they traveled over 100,000 miles in the U.S. on deputation presenting their vision in more than 100 churches to raise support to allow them to go overseas. Finally, he was commissioned by his home church to go overseas as missionary in March 2009. They are now on the mission field as missionaries. In 2007 and 2008, he paid SECA tax; he did not claim a housing allowance because he had not been commissioned and because he was moving from place to place. Occupation listed on his tax returns was “Missionary.”
Having paid SECA in 2007 and 2008, has he missed the two year window to file form 4361 due to a conscientious objection over religious beliefs? Or can he now file and consider the self-employment income (1099-Misc from Mission Board) as marketing income since he was not on the field and was not commissioned yet by his local church?

It is not possible to have earnings as a minister of the gospel under federal tax law prior to being ordained, licensed or commissioned as such. Assuming your son was commissioned as a minister of the gospel under his home church’s governing structure and polity (i.e., that the commissioning resulted in him being considered a minister by his church according to his church’s bylaws and other governing documents), and assuming that his duties after commissioning comprise duties in the exercise of ministry as defined in the Internal Revenue Code and related Regulations, his earnings as a minister began after his commissioning. The nomenclature used to describe his work prior to commissioning is not determinative, nor is the manner in which such earnings were reported for Social Security purposes (employment or self-employment).

Accordingly, there is no reason to believe, based on the facts you have provided, that his earnings as a minister began before 2009. Your son should be encouraged, however, to carefully read the requirements for Social Security exemption on Form 4361 before filing it to ensure that his basis for claiming exemption is legitimate. He should also carefully weigh the implications associated with exemption, as the election is irrevocable under current law.

This information is current as of December 2009 and is not to be construed as tax or legal advice.

Michael (Mike) E. Batts is a CPA and the managing partner of Batts Morrison Wales & Lee, P.A., an accounting firm dedicated exclusively to serving nonprofit organizations across the United States.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations." Due to the nature of the U.S. legal system, laws and regulations constantly change. The editors encourage readers to carefully search the site for all content related to the topic of interest and consult qualified local counsel to verify the status of specific statutes, laws, regulations, and precedential court holdings.

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