This salary should be comparable to other professionals with similar education and community responsibility — such as school administrators, guidance counselors, social workers, and non-profit directors. If a parsonage is provided, include the fair market rental value unfurnished, without utilities.
3 Housing Options
Conservative unfurnished market rent without utilities. Deducted from total comp. Subject to SECA.
Not compensation. Excluded from income tax, MAGI, and SECA.
Designate up to the furnished + utility FMV of the pastor's home. If unknown, calculate for a typical home in your community. Excluded from federal income tax and MAGI. Subject to SECA.
Total Comp - Housing Allow.-
Taxable. Reported as Wages on W-2.
4 SECA Allowance
Total Comp x 7.65%-
Taxable. Reported as Wages on W-2. Equivalent to the FICA payroll taxes normally paid by an employer on behalf of an employee. Ordained ministers bear this cost themselves; the congregation owes no employer-side payroll tax.
5 Retirement - LCMC 403(b)
Pre-tax. Recommended employer contribution is 10 to 12% of total compensation. The pastor may also elect to make additional pre-tax contributions through payroll deduction up to the IRS annual limit. For enrollment and plan details visit lcmc.net/retirement-benefits.
Total Comp x 10%-
Pre-tax. Recommended: 10 to 12% of the parsonage unfurnished FMV. Compensates for the pastor's inability to build home equity during ministry.
Parsonage FMV x 10%-
6 Health Insurance
The pastor has the option to extend coverage to family members by covering the additional premium difference through pre-tax payroll deduction.