Should ordained pastors/ministers opt out of self employment taxes (i.e. Social Security and Medicare taxes)?
Unless you meet extremely rare requirements.
None of which include the following:
- Social Security benefits won’t be available when I retire
- It’s poor stewardship of God’s money
- I can do a better job investing than the government
- It’s not the governments job to take care of people
- Extra cash in the pocket!
In order to opt out you agree to:
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.)
~IRS Form 4361
That statement is extremely wordy. So let me simplify it for you.
I am conscientiously opposed to the acceptance of any public insurance that makes payments in the event of death, disability, old, age or retirement.
The key here is if you have a conscious/religious objection to receiving public insurance (e.g. Social Security, Medicare).
Most arguments I’ve heard for opting out argue against the Social Security system. It’s not the governments job. Won’t be available when I retire. I can do a better job investing for retirement . . .
Those are all invalid arguments.
Remember, the form is asking if you have an objection to receiving public insurance. It is not asking what you think about public insurance as a whole.
Should you opt out? One question to ask yourself.
It all boiled down to this question for me.
Assume you’ve paid into the Social Security system for 50 years. Would you be okay receiving retirement benefits from the government (or any of the benefits from the other public insurance programs)?
If you answer yes to this question you have no religious or conscious reason to ethically sign the form and opt out.
“Even if I have to pay the taxes, I can never file for the benefits, since my theology will never allow me to accept them.”
~Memo #10 – Can Ministers Opt Out of Social Security?
The decision to opt out of social security should not be taken lightly.
~Evangelical Council for Financial Accountability
Read Form 4361. Don’t blindly accept the advice of others. Know what you are signing and saying yes to.
I highly recommend reading this article from Russell Moore for a very well argued and biblical response to whether ordained ministers/pastors should opt out.
Be sure whatever your decision, you can stand before Jesus with a clear conscious and a pure heart.
I think a great prayer in this situation is:
Create in me a pure heart, O God, and renew a steadfast spirit within me.
~Psalm 51:10 (NIV)
A pure heart. One that is not tempted by money. A steadfast spirit. One that strives to live according to God’s moral and ethical standards.
Sources and Additional Resources
- Is it Okay for Me to Opt Out of Social Security? My Response (highly recommended)
- Memo #10 – Can Ministers Opt Out of Social Security? (read section titled A “Catch” Often Overlooked)
- Ministers Opting out of Social Security (read bottom section after “Basis for filing for an exemption…”)
- On Opting out of the Social Security System
- Opting out of Social Security
I’d love to hear your reasons for either opting out or not. Please let me know in the comments!