Staff Ethics Question

A pastor, like all christians is supposed to be a faithful steward of all that God has given him. Being that the pastor is supposed to be above reproach, I would say if he were struggling with bills, he should have spoken to someone about it before now.

 

Been there, done that, with a staff member who, when I taught him how to do taxes, proclaimed that he did not intend to pay Social Security because he couldn't afford it. I told him he had no choice, and thought he was joking anyway. But a few years later here came the garnishment notice from IRS. When I told him what we had to do, first he said it was all a big mistake and then he wanted it just to be between him and the IRS -- however, not only did we have no choice about that, but also my instinct was that we had to get the congregation's appropriate officers involved in this.

So instead of going to the congregation or asking for his removal, I alerted the financial officers, the deacon chairman (and Pastor-Church Relations Committee chair) and the Administrative Committee chair (that's the personnel committee). All were appalled but we thought we should try to help redeem this man.

After a number of months of garnishment he told me one day we could start his full check again, the IRS was satisfied. My response was, "Not until the IRS tells us they are satisfied." And of course they were not.

Too many other evidences of laziness, financial malfeasance, and other issues .. our church constitution did not give me the power to dismiss him, and we knew that if we took it to the congregation it would be nasty, so my strategy was to tell him personally that he needed to find something else to do and move on. It took a few months, but he did move on.

Perhaps the worst part of all of this is the lost time and energy, taken from doing ministry, in order to attend to stuff like this. My time as well as his.

 

Rev. Smith,
Was your church paying him as an independent contractor? Because if he was an employee, why was your church not deducting for SS and Med, adding the church's portion and remitting all to the IRS?
Sounds like you handled it well. But the next time you would be faced with such a situation, I presume you already know to look at the individual facts instead of just putting the old guy's face over the new situation.

Karen

 

Churches can either do the SS and Medicare withholding and the employee can file taxes as usual or they can pay without withholding anything and then the employee needs to pay the self-employment taxes. I'm not sure what the benefits of either are.

However, no matter which way it was set up he should have been filing a tax return. I suspect from the account given that this man just has not filed a return at all. I would ask him to bring in his tax returns for 2004 and 2005 and any extensions he has filed. If he has zero paperwork, I think that's a sign that he is not really under any unusual financial strain but just doesn't care to pay his taxes.

 

He was ordained and therefore technically self-employed.

 

See www.churchlawtoday.com/newminlesson.php?144

I have been a tax preparer, but have never done ministerial taxes. There do seem to be many ways in which ministerial taxes differ.
It is my understanding that my church withholds SS. and Med. on the voluntary basis described in the above link. Perhaps that would be a good idea for many ministers.

Karen

 

"Ministers" (as the IRS defines them) are self-employed as to SS taxes. Furthermore, Wages paid to a "minister" for services performed in the exercise of ministry are not subject to federal income tax withholding. (The IRS has a definition for "minister"--check and see if you qualify).

It's scary how many churches mess this up...I've been messed up before through an ignorant treasurer & financial secretary.

One helpful link

 

Also, the levy could be a mistake or a misunderstanding. The IRS put our 2003 refund into someone else's bank account. It took us over a year to get it. Then, through fault of the IRS, we were levied for 2004. Then, we straightened that out because we had put the correct amount on the wrong line. The IRS agreed that we had paid the correct amount, so we only needed to pay the penalties and interest. (I could never make the girl on the phone realize that if the correct amount was paid, there were no penalties or interest.)

We finally got it straightened out in February of 2006.

There were letters sent to all sorts of people, and the error was on behalf of the IRS.

That being said: There could be medical problems in the past, simple misfortune, or a mistake on the IRS form that led to penalties and interest that cannot be paid.

The injury to my leg, which is an ongoing problem that will continue accumulating expenses, has already cost in excess of $250,000. There are letters, etc. going out about that. But, mostly because my employer had failed to pay his workers comp insurance. Once things are settled in court, his liability insurance will pay, but I will have had a couple of years of judgments, etc. on my record before it's all said and done.

There may be extenuating circumstances that do nor reflect poorly upon the man at all. Then again, he may be a bum.

Just a few things to keep in mind.

 

The constitution guarantees the freedom of religion, speech and privacy, it also states that government (congress) will not make or pass laws concerning (respecting) religion.

Some have taken this to mean that they do not have to follow the laws of the land. Government is ordained and sanctioned by God.

We are scripturally bound to obey the law, pay our taxes and to respect and pray for the ones God has allowed to be in power.

A number of Churches and ministries today feel they do not need to obey the IRS, pay thier taxes, and respect other laws.

My advice, be careful, if you choose to boycott the paying of taxes, and disobey the law of the land, you are no different than any other common criminal and you are acting in defiance of Gods law and the Scriptures.

Being a church, even a Bible believing Bible Preaching church is not licence to do what you please.

Obey the law, pay your taxes (render unto Ceaser), pay your tithes (and unto God) and be beyond reproach (behave). Pray for those who persecute you, Love your enemies, and do good to those who would choose to be your enemy. God Bless you!

 

Is it grounds for termination in and of itself? I would say if you can prove that it was intentional, yes. I also agree with David Singleton.

You mentioned you've been trying to get rid of him for 9 months. Why has it been taking so long? It's very easy to fire someone, unless the rest of the church is resisting you.

Here's the context of what David Singleton was referring to:

Matthew 22
16And they sent their disciples to Him, along with the Herodians, saying, "Teacher, we know that You are truthful and teach the way of God in truth, and defer to no one; for You are not partial to any.

17"Tell us then, what do You think? Is it lawful to give a poll-tax to Caesar, or not?"

18But Jesus perceived their malice, and said, "Why are you testing Me, you hypocrites?

19"Show Me the coin used for the poll-tax." And they brought Him a denarius.

20And He said to them, "Whose likeness and inscription is this?"

21They said to Him, "Caesar's." Then He said to them, "Then render to Caesar the things that are Caesar's; and to God the things that are God's."

 

Pastor Brad,

What has happened in this situation if you do not mind me asking? Have you been able to resolve things so that the church has not been hurt? Is the man in question still useable? Just courious.