4 ms·
> For churches, that exemption is automatic. And that was the point. Other organizations have to be based around some particular beneficial purpose such as cha
by nybble41 4y ago
> For churches, that exemption is automatic.
And that was the point. Other organizations have to be based around some particular beneficial purpose such as charity or education in order to qualify, and that classification can be challenged if, for example, a "charitable" organization doesn't actually redistribute most of the money it receives to charitable causes, but you can start a religious-themed amusement park (charging admission!) and call it a "church" and it's automatically tax-exempt.[0]
> exempt from withholding but they still have to pay it
Which means they're getting several months' worth of extra growth out of that portion of their income than everyone else by paying it at the end of the tax year rather than having it withheld from their paycheck. It's clearly a religious privilege; other W-2 employees would opt out of withholding if they could, but they can't since they aren't ministers.
> and they pay FICA taxes like self employed workers
Despite not being self-employed, and only if they don't use Form 4361 to opt out of Social Security, as I said before. Which is something which can only be done on religious grounds, or a lot more people would be doing the same, as SS is a poor retirement strategy compared to investing the same amount of money privately. (The average rate of return for SS contributions is lower than T-bills, much less mutual funds or stocks.)
[0] https://www.orlandosentinel.com/features/os-holy-land-experience-tax-breaks-20160225-story.html https://www.orlandosentinel.com/features/os-holy-land-experi...