Special tax provisions apply to individuals who qualify as “ministers.” For example, they are allowed to exclude certain housing allowances from gross income and are exempt from federal tax withholdings. Most ministers are classified as employees, yet courts have also held some of them to be independent contractors. Minister‐employees have a dual tax status. They are considered employees for income reporting, fringe benefit, and expense deducting purposes but are treated as self‐employed persons for social security purposes. Because of their intricacies and material financial impact, special provisions that apply to ministers demand thorough legal analysis and careful tax planning. This article analyzes several key tax issues that confront ministers and provides a variety of tax planning ideas.

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