Welcome back! Ask questions, get answers, and join our large community of tax professionals.
cancel
Showing results for 
Search instead for 
Did you mean: 

Does Clergy Income (reported on a W2 where the Clergy must pay self-employment tax) qualify for the QBI deduction? The clergy works at a church.

jesusmac2000
Level 3
 
0 Cheers

This discussion has been locked. No new contributions can be made. You may start a new discussion here

1 Solution

Accepted Solutions
itonewbie
Level 15

Many a time, clergy and ministers are common law employees of religious organizations to which they belong, as determined by various factors used by the IRS and the courts.  That's also why these individuals are issued W-2's, notwithstanding side gigs they may have in some other capacities and the fact that §1402 has a special provision just for the purpose of SE-tax.

On that basis, compensation reported on W-2 is income received for the trade and business of being an employee and should not be eligible for QBI.

---------------------------------------------------------------------------------
Still an AllStar

View solution in original post

5 Comments 5
itonewbie
Level 15

Many a time, clergy and ministers are common law employees of religious organizations to which they belong, as determined by various factors used by the IRS and the courts.  That's also why these individuals are issued W-2's, notwithstanding side gigs they may have in some other capacities and the fact that §1402 has a special provision just for the purpose of SE-tax.

On that basis, compensation reported on W-2 is income received for the trade and business of being an employee and should not be eligible for QBI.

---------------------------------------------------------------------------------
Still an AllStar
Marc-TaxMan
Level 8

Are you a paid pro?  What does your continuing ed say about w-2 employee and QBI?

0 Cheers
Skylane
Level 11
Level 11

@Mt Juliet CPA  

Eddie, you have any insights? 

If at first you don’t succeed…..find a workaround
0 Cheers
Skylane
Level 11
Level 11
@Marc.TaxMan    Based on his question I'd say he was paid.........  what does your continuing education say about statutory employees and/or clergy?
If at first you don’t succeed…..find a workaround
0 Cheers
Marc-TaxMan
Level 8
It's not my client, so I'm not doing the research!  But the 199A Regs would be my starting point
0 Cheers