Clergy Compensation Worksheet  
 No Church-Provided Housing  
    
    

  
1Salary:1
2Housing Allowance (based on Fair Rental Value):2

  
3Cash Stipend:0.00 
4Cash Housing/Utilities Allowance:0.00 
5Self-Employment Tax Reimbursement (SECA):30.00 
6Subtotal Cash Compensation:40.00 
   
7Pension Assessment:0.00 
   
9Medical Insurance Premium:5
10Dental Insurance Premium:
11$40,000 Group Term Life Insurance:302.40 
12Subtotal Insurance Benefits:302.40 
   
13Travel/Business Expense Reimbursement:6
14Continuing Education Reimbursement:
15Subtotal Reimburseable Expenses:0.00 
   
16Total Package:302.40 

  
    

  
   
   
 1 A cleric’s salary is comprised of three figures: a cash stipend, a cash housing/utilities allowance (plus a non-cash housing amount if housing is provided), and, customarily, a self-employment tax reimbursement. When a position is advertised in the church, the salary is the principal figure.
 2 The cleric should enlist the services of a local real estate broker to estimate the fair rental value of the cleric's home or rented property -- which will determine the housing allowance. This estimate should be based upon property location, size, condition, and include consideration for utilities, taxes, furnishings, and insurance. Housing and utilities costs, up to the estimated fair rental value, are tax deductible for the cleric. A vestry must approve the designation of a housing allowance. Download the IRS Housing Allowance Regulation and applicable forms.
 3 The IRS considers clergy to be "self-employed," and therefore responible for paying SECA (Self-Employment Contributions Act) which comprises both the employee and employer portion of FICA (Federal Insurance Contributions Act). This 15.3% tax funds Social Security and Medicare. It has become the custom in the Episcopal Church for churches to reimburse their clergy half of the SECA tax (7.65%), effectively treating them as employees rather than self-employed independent contractors. It is important to note that a SECA reimbursment should not be calculated as an addition to the salary but, rather, as part of the salary. This worksheet "backs out" the appopriate SECA amount from the salary.
 4 The total cash compensation serves as a basis for calculating pension. The total cash, or "pension base" is multiplied by 18%: 0.00 x 18% = 0.00. Additionally, the cleric's twice-monthly gross payroll amount can be determined by dividing the total cash compensation by 24. In this case: 0.00 ÷ 24 = 0.00.
 5 The costs for medical and dental insurance premiums may be paid in full by the church or shared between the church and cleric, depending on the lay/clergy insurance parity arrangement determined by the vestry. The diocesan minimum standard is that the employer pays the first $8,200 in insurance costs for employee-only coverage, and then may add a recommended $5,600 to cover a portion of family premiums. The diocesan minimum standard for dental insurance is that the employer pays $542.40 for employee-only coverage, and then may add a recommended $400 towards family premiums. The premiums for group term life insurance, required by the Diocese of Arkansas, are customarily paid in full by the church. See the costs, requirements, and policies for medical and dental insurance relevant to the Episcopal Diocese of Arkansas by downloading the 2018 Standards and Plan Offerings.
 6 It is customary to budget an amount clergy may be reimbursed from when incurring expenses in the course of professional activities on behalf of the church. Additionally, as the Canons of The Episcopal Church direct clergy to engage in continuing education, a reimbursement amount is also customarily budgeted for this purpose. The recommended annual amount for a full-time cleric is $2000 for each account.