What a church or nonprofit pay stub shows
The lines depend on who is being paid. The sample on this page is a pastor's monthly stub: salary, a designated housing allowance and income tax withheld by agreement, with no social security or Medicare.
| Line | Minister (ministerial services) | Other church or nonprofit staff |
|---|---|---|
| Salary or wages | Yes | Yes |
| Housing allowance | Its own line, designated in advance | No: housing paid to staff is wages |
| Federal income tax | Only under a voluntary agreement | Withheld from Form W-4 |
| Social security and Medicare | Never withheld: the minister pays self-employment tax | Withheld, unless the church has elected out on Form 8274 |
| FUTA (employer only) | Not owed by a 501(c)(3) | Not owed by a 501(c)(3) |
Ministers: why there's no FICA on the stub
IRS Publication 15-A says a minister's earnings for ministerial services aren't subject to federal income tax, social security or Medicare withholding, whether the minister is your employee or self-employed. A minister here is someone ordained, commissioned or licensed by a church, with authority to lead worship and administer sacraments.
- The minister pays social security and Medicare themselves, as self-employment tax on their return, even when they are a common-law employee of the church.
- The minister can ask you to withhold federal income tax under a voluntary agreement. Publication 517 says it can be set high enough to cover their self-employment tax too. It still goes on the stub and the W-2 as federal income tax.
- Some ministers have an IRS-approved exemption from self-employment tax on religious grounds, applied for on Form 4361. That doesn't change what you withhold.
- Pay for work that isn't ministerial, such as a second job in the church office, follows the normal rules.
The housing allowance on a pay stub
A minister can leave a housing allowance (also called a parsonage or rental allowance) out of income for federal income tax, but only if the church designates it before paying it. Publication 517 asks for a definite amount, set by the congregation that employs the minister, in a contract, the minutes, a budget or another official action. An informal talk isn't enough, and the amount can't be set afterwards.
- The minister can exclude no more than the smallest of: the amount designated, the amount actually spent on providing a home, and the fair rental value of the home (furnished) plus utilities. The total can't be more than reasonable pay for the work.
- The allowance is only excluded from income tax. It is still part of the minister's earnings for self-employment tax.
- On Form W-2, leave the allowance out of box 1. You can show it in box 14 or in a separate statement. Don't fill in social security or Medicare wages for the minister.
On the pay stub, put the housing allowance on its own earnings line, named as designated, so the minister can match it to the church's resolution. Their salary goes on another line.
Sources: IRS Publication 15-A (2026), section 4, and Publication 517 (2025), read on October 8, 2026. Whether an amount is excludable is settled on the minister's own return. This page is general information, not tax or legal advice.
Church staff and other nonprofit employees
Employees of a church or a 501(c)(3) who aren't ministers, such as an administrator, a youth worker or a caretaker, are paid like any other employee. You withhold federal income tax from their Form W-4, and social security and Medicare at 6.2% and 1.45%, matching both as the employer.
| Line | Amount |
|---|---|
| Gross pay | $1,600.00 |
| Federal income tax (Publication 15-T) | $108.15 |
| Social security (6.2%) | $99.20 |
| Medicare (1.45%) | $23.20 |
| Net pay (before state tax) | $1,369.45 |
- No social security or Medicare is due on an employee paid less than $100 in the year by a 501(c)(3).
- A church or church-controlled organization opposed to social security for religious reasons can elect out of FICA by filing Form 8274 before its first quarterly Form 941 is due. Its staff then pay self-employment tax once their pay reaches $108.28 in the year.
- A 501(c)(3) is exempt from FUTA, and Publication 15-A says the exemption can't be waived. State unemployment rules for churches and nonprofits are set by each state.
How to make a church or nonprofit pay stub
- Get the period's figures from your payroll: salary, any designated housing allowance, and each tax or deduction withheld.
- For a minister, enter the salary, use "Add earnings line" for the housing allowance, and add federal income tax only if you have a voluntary agreement. Leave social security and Medicare off.
- For other staff, enter the pay and the tax lines as usual. Check that net pay matches the payment.
PayDocs works out federal income tax, Social Security, Medicare and supported state taxes for 2026 pay dates (see what we calculate). PayDocs doesn't decide who counts as a minister or how much housing allowance is excludable; it turns your payroll figures into a clear stub.
A PayDocs pay stub records a real payroll payment. It is not proof of income, and nobody should present one as such.
Questions
Do churches withhold social security and Medicare from a pastor's pay?
No. A minister's pay for ministerial services has no social security or Medicare withheld, even when the minister is an employee. The minister pays self-employment tax on their return instead, unless the IRS has approved an exemption.
Does a church have to withhold income tax from a minister?
No. Federal income tax is withheld from a minister's pay only if the minister and the church agree to it. The agreed amount can be set to cover the minister's self-employment tax as well, and it is reported as federal income tax withheld.
Does the housing allowance go on a pay stub?
It should, on its own earnings line, so the minister can match it to the amount the church designated in advance. It stays out of box 1 of Form W-2 and can be shown in box 14.
Is a housing allowance subject to self-employment tax?
Yes. A designated housing allowance can be excluded from income for federal income tax, within the limits, but Publication 517 says the exclusion doesn't apply to self-employment tax.
Do nonprofits pay FUTA?
Not if they are exempt under section 501(c)(3): Publication 15-A says they are also exempt from FUTA, and the exemption can't be waived. Other nonprofits pay FUTA as usual.
Are church employees exempt from FICA?
Usually not. Church staff who aren't ministers have social security and Medicare withheld like other employees, unless the church has elected out on Form 8274 because it is opposed to the taxes for religious reasons.
Sources
- IRS — Publication 15-A (2026), Employer's Supplemental Tax Guide: exempt organizations and ministers
- IRS — Publication 517 (2025), Social Security and Other Information for Members of the Clergy and Religious Workers
- IRS — Publication 15 (Circular E), Employer’s Tax Guide
Official sources checked October 8, 2026. This guide explains how pay documents work; it is not tax or legal advice.
