Payroll · Churches
An ordinary payroll system treats the pastor like any other employee, because it can't tell the difference. The provider makes the mistake — the church is the one who answers to the IRS.
Built for churches across the United States: a pastor's rules aren't the staff's rules.
What's at stake
To the government he's an employee and self-employed at the same time. If the system treats him like an ordinary employee, deductions come out of his pay that never applied to him —he takes home less than he should— and in April the 15.3% bill on his ministry earnings lands anyway.
When the system treats him as an ordinary employee, the church pays the employer's share, which in a minister's case it never owed. It's losing money on something that didn't have to be paid, and it repeats every pay run until someone checks.
A minister has tax advantages other workers don't get, starting with the housing allowance. In most of the payrolls we review, they aren't being applied.
It isn't the church's fault: hardly any church runs its own payroll, and the provider that runs it can't tell a minister from the rest of the staff. That's exactly why we exist.
Put numbers on it
If your pastor is run like any other employee, this is what shifts every year. Move the sliders to your church's case.
The church pays what it doesn't owe
$2,754 a year
$13,770 over 5 years, so far
The pastor is charged what doesn't apply to him
$2,754 a year
$13,770 over 5 years, so far
Between the two, every year
$5,508 a year
$27,540 over 5 years, so far
These are the Social Security and Medicare rates applied to the salary you enter: there's no assumption behind it. It doesn't include the housing allowance, which depends on each minister's situation.
The slider stops at $150,000 because above the Social Security wage base the math would stop being exact.
The math runs in your browser and stays there. Nothing is sent or stored.
Let's look at it with your numbersWhat we do
Three things that are almost never set up right, and that get settled from the first cycle.
No 1099, no envelope with nothing to show for it: his W-2, with the treatment that belongs to him, from day one.
The pastor follows his; the office, the musicians and the cleaner follow theirs. Both in the same payroll, without mixing.
We put in order what supports it: credential, duties and board resolutions. And if someone on the team doesn't qualify, we tell you before the IRS asks.
Is the church not formally organized yet —no articles, no bylaws, or no 501(c)(3)? That comes before payroll, because it's what holds everything else up. See company formation
The biggest saving
It's the biggest tax advantage a minister has, and the one most often left unused. We handle the work, the paperwork and the deadlines. We're your ally in the day-to-day.
And it doesn't cost the church a cent: it isn't new money, it's the same salary put together differently. The budget doesn't change; what changes is how much of it reaches the pastor's home intact.
And if it hasn't been designated for years, we set it up from this year on: what's behind can't be recovered, but everything ahead can.
What's included
With its own treatment and the housing allowance applied where it belongs, every cycle.
Office, musicians, teachers and cleaning, with ordinary withholding and deposits.
Forms and deposits with the IRS and your state, within the deadline.
Direct deposit with a clear stub, on whatever schedule the church chooses.
The pastor's and the staff's, each one as it should be.
The board resolutions and the documents that support each treatment, kept on file.
And the rest of the church
Members, giving, attendance and communication in one system, under your congregation's own name and logo. If we're going to put what goes out in order, it makes sense to show you what comes in too.
It's this simple
How the pastor is paid today, who else is on payroll, and what documents exist.
Everything that supports each treatment, signed and filed where it belongs.
Once: the pastor with his treatment and the staff with theirs.
Calculation, direct deposit, tax deposits and forms on time.
Pricing
The cost depends on how many people are paid by the church and how often. We give you a clear quote, no fine print.
Request your quoteFrequently asked
Let's start
Leave us your details and we'll call to review how the pastor is paid, who else is on payroll, and what's still undocumented.
General information, not legal or tax advice. IRS and state rules can change, and minister status depends on the facts of each case; we confirm yours with you.
If you'd rather read up first
We wrote the full series so a board can work it out on its own: the dual status before the IRS, why a 1099 doesn't fit, and how the housing allowance gets designated.
To the IRS a minister stands on both sides of the street at once, and almost everything churches get wrong in their payroll comes from that. Here's the rule and what the law doesn't allow.
Paying a staff pastor on a 1099 is one of the most common mistakes churches make, and it comes from reasoning that sounds airtight. Here's why it fails, and when a 1099 is in fact correct.
The housing allowance keeps the part of a pastor's salary that goes to his home out of income tax, and it costs the church nothing from the budget. How it's calculated and why it gets lost.
Form 4361 exempts a minister from the 15.3% for good, and there's no going back. What it actually requires, what it doesn't cover, and why most of the people who ask about it are already past the deadline.
