Should I Opt-Out of Social Security?

Well . . . I'll give you the short answer first and the long answer second.

Short Answer: Only you can answer that question.

Long Answer: Only you can answer that question because your decision has to be based on your own conscience or Biblical/religious convictions. Let me explain.

In order to opt-out of Social Security, pastors must file Form 4361 (titled, “Application for Exemption From Self-Employment Tax for Use by Ministers, Members of Religious Orders and Christian Science Practitioners”) affirming the following statement:

I certify that I am conscientiously opposed to, or because of my religious principles I am opposed to, the acceptance (for services I perform as a minister, member of a religious order not under a vow of poverty, or a Christian Science practitioner) of any public insurance that makes payments in the event of death, disability, old age, or retirement; or that makes payments toward the cost of, or provides services for, medical care. (Public insurance includes insurance systems established by the Social Security Act.)

I certify that as a duly ordained, commissioned, or licensed minister of a church or a member of a religious order not under a vow of poverty, I have informed the ordaining, commissioning, or licensing body of my church or order that I am conscientiously opposed to, or because of religious principles, I am opposed to the acceptance (for services I perform as a minister or as a member of a religious order) of any public insurance that makes payments in the event of death, disability, old age, or retirement; or that makes payments toward the cost of, or provides services for, medical care, including the benefits of any insurance system established by the Social Security Act.

I certify that I have never filed Form 2031 to revoke a previous exemption from social security coverage on earnings as a minister, member of a religious order not under a vow of poverty, or a Christian Science practitioner.

I request to be exempted from paying self-employment tax on my earnings from services as a minister, member of a religious order not under a vow of poverty, or a Christian Science practitioner, under section 1402(e) of the Internal Revenue Code. I understand that the exemption, if granted, will apply only to these earnings. Under penalties of perjury, I declare that I have examined this application and to the best of my knowledge and belief, it is true and correct.

What this means is that you must have an honest, religiously-based objection to contributing to Social Security or Medicare out of your ministerial income. Financial/political/personal objections do not count and cannot be honestly used. Your objection must be based on either your conscience or on some Biblical principle.

Obviously, only you can say whether or not you have this kind of religiously-based objection.

Have you made a decision about opting out of Social Security? If so, leave a comment below, or visit me on Facebook and leave a comment there.


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HOW TO NOT BE A BROKE PASTOR

Are you struggling to understand the unique and challenging world of pastoral compensation? Are you maximizing the benefits that could be yours by simply being "wise as a serpent and innocent as a dove" when it comes to how you structure your pastoral pay? 

As a pastor, I get it. Not only can our compensation be confusing, but there are also so many different components that need to be balanced . . . it can be hard to put all the pieces together.

How to Not Be a Broke Pastor is written for pastors/ministers and is designed to make the complexities of clergy pay simple and easy to understand, and also to give you ideas as to how you can use your income to the greatest extent possible. We may not have entered the ministry to get rich, but that doesn't mean we should be broke. Let me help you understand and maximize the benefits of your compensation today.