render unto Ceasar (as little as possible)

I did my taxes this weekend, and once again I was reminded of the significant perks which our government gives ordained ministers.  If the government is serious about closing loopholes it should probably look at the breaks it gives us.  Housing allowance saves me a lot of money each year, and I could save bushels more if I opted out of social security.  But I won’t because I believe doing so is dishonest and dishonors the gospel of Jesus Christ.

IRS publication 517 states that an ordained minister may opt out of paying social security taxes if 1) “You are conscientiously opposed to public insurance because of your individual religious considerations” and 2) “You file for other than economic reasons.”

Nearly every minister who opts out, and there are many, does so precisely for economic reasons.  If social security was paying 50% annual returns, how many would keep their objection to it?  My uncle is a C.P.A., and he told me that he did the tax return for an Amish man who received a social security check for time he worked in a job that deducted payroll taxes from his salary.  The man returned the check to the government because he didn’t believe in public insurance.  That man has a conscientious objection.  If you wouldn’t return the check, then you can be sure that you don’t.

Russell Moore wrote eloquently on this topic last week, and he observed that you are a conscientious objector if, like pacifists objecting to war, you would choose jail rather than pay into social security.  If not, then you are faking your objection, using a loophole in the law that the government graciously intended for folks like the Amish.

Several years ago I heard financial expert Dave Ramsey encourage ministers to opt out of social security because of the “moral objection” that the government was mishandling their money.  I wrote Dave to object.  I don’t know if he ever received my letter (I’m sure that correspondence must go through several levels to get to him), and as far as I know he is still giving the same advice.  Now that I have a blog, I’ll post the letter here.

Dear Dave:

As a frequent listener to your radio program, I appreciate the common sense and good humor that you bring to your financial advice.  You are doing a lot of good for a lot of people.

However, I urge you to reconsider the counsel you often give ministers who are contemplating opting out of the social security program.  IRS publication 517 states that a minister may opt out of social security if he is “conscientiously opposed to public insurance because of [his] individual religious considerations.”  The very next point explicitly states that “economic reasons” do not qualify (pages 3-4).

Thus, when you encourage ministers to opt out of social security on the “religious” grounds of stewardship (you can invest your money better than the government) rather than a principled objection to public insurance (such as an Amish person might have), you are unwittingly advising ministers to break the law.

This has implications for the integrity of the minister and the testimony of Christ’s church.  What would people think, especially those outside the church, if they knew that the same pastor who preaches honesty, sacrifice, and love for Christ above all lied to the government in order to save money on his taxes?  If the national media should ever catch wind of this, it would be a scandal for sure.  And what would be our defense—that we do have religious objections to social security, so long as you allow us to define “religious” as poor stewardship rather than opposition—on principle—to public insurance?  We who criticized Bill Clinton for his disingenuous equivocation on the verb “is” should know better.

I wish I could sign Form 4361, as I paid a lot of money in self-employment taxes last year.  But as I am sure you would agree, this is a small price for my integrity.

May God continue to bless your ministry,

Michael Wittmer

End of letter and one final thought:  I don’t think I know anyone who has what the IRS calls a conscientious objection to social security.  But for argument’s sake let’s say that Pastor Jones of First Baptist Church has convinced himself that he does.  Pastor Jones would still have the problem that many people, if they knew that he had opted out, would assume that he was doing so for economic rather than moral reasons.  In this case he would still run the risk of bringing disrepute upon the gospel, which is not worth the thousands of dollars he saves each year.  Sometimes perception is reality.

25 Comments

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  1. How do you qualify for the housing allowance?

  2. Are you saying I’m unqualified? 🙂 I am ordained and work for a seminary, so the government says I qualify.

  3. “I don’t think I know anyone who has what the IRS calls a conscientious objection to social security. “

    Pastor Doug Wilson does, I believe, based on what he’s written recently on this subject.

    But generally, you are right, not many Christians have a truly conscientious objection to it. But they should start having one rather than supporting immoral Ponzi schemes.

  4. Thanks for the insight. We had a situation a few years ago at our church where the senior pastor was encouraging an ordained staffer to opt out, but the staffer could not do it in good conscience. As the staffers young family scrapped by every month to pay their bills I saw what integrity really meant. This true showing of following Jesus didn’t last long at our church as the staffer was soon let go. I always wondered if the questioning of the validity of opting out of social security played a part in his being let go. Thanks again for the clear explanation of the facts.

  5. Yeah, I had a debate with a fellow pastor over this exact issue a couple of years ago. He had opted out many years ago and could not understand why I had not done the same. When I told him I could not because I do not have a conscientious objection to social security he took offense. It was apparent from our conversation that he had only opted out for economic reasons and he did not like it that I made him feel as though he was doing something unethical (even though I never accused him of anything).

    On another note: the tax breaks ministers receive are only wonderful if the minister is NOT living in a church-provided parsonage. It may seem like a great deal that the pastor has a “free” place to stay, but in reality the pastor has to pay 15% tax on the fair market rental value of that home. That means the minister is not getting anything for “free”. He would be no worse off if the money was in his check and he were renting. The best thing a church can do for its pastor(s) is to give tham the best salary possible and allow them to purchase their own home. This is where the tax breaks mean something!

    Parsonages are a great deal for the church, but a not so great deal for the pastor.

  6. Mike,

    I responded to Moore when he posted his piece. In essence, I agree with him that it is sinful for ministers to opt out for economic reasons, since this would require they sign a form and lie (and committ perjury to boot).

    Still, Moore pushed things much, much further than the IRS requires. In his article, he actually said unless your willing to stand in the pulpit and tell your people that SS is a sin, then you are not a conscientious objector. The problem with that line of thinking is that it betrays an infamiliarity with the IRS documents. The IRS is quite clear that one does not have to think SS is sinful. Nor do they have to object to the system in general. One must, however, have an objection to receiving public assistance FOR WORK DONE AS A MINISTER. Thus, a pastor can think SS is a good idea for the person in the pew, but still feel it violates scriptural principles regarding separation of church and state.

    Furthermore, one can opt out even if he doesn’t think it is a sin even for a minister. I don’t think combining church/state is sinful—but I do think it is unwise and goes against the grain of biblical principles. Yet I see no command in scripture that the Church and State must be completely seperate. It is an implied principle. There is a difference to having a religious objection and thinking something is a sin.

    Furthermore, I fully disagree with the idea that we should go to jail rather than pay SS, even if we had a true objection. That would be violating a CLEAR teaching and command of Jesus (give to Caesar what is Caesars). If forced, a true objector would pay the tax but refuse the benefit, as your Amish example demonstrates. Thus, the whole “go to jail” thing is a red herring.

    While I would not recommend a pastor opt out, I would argue that SS goes against what I see as the NT principle of caring for a pastor. I think a perfect situation would be church’s actually caring for their ministers in retirement, without governmental assistance. The whole concept of ordaination is “setting a man apart for the work of the Lord”. Opting out of SS COULD naturally flow from that principle (though I am not suggesting it has to).

    All in all, I think there are very valid biblical reasons for opting out. But, I do like your point regarding benefits. In the end, for most it is probably just a money issue—-sadly they (and Moore) I would argue are missing the truly significant biblical principles that undergird this entire situation.

  7. With the name change to Grand Rapids Theological Seminary was anything else given up – i.e. ties to a particular denomination?

    Ministers
    Most services you perform as a minister, priest, rabbi, etc., are qualified services. These services include: Performing sacerdotal functions…A religious organization is under the authority of a religious body that is a church or denomination if it is organized for and dedicated to carrying out the principles of a faith according to the requirements governing the creation of institutions of the faith.

    http://www.irs.gov/publications/p517/ar02.html#en_US_publink100033572

    The educational institution must be an integral part of a church or denomination. Thus, faculty and administrators
    at interdenominational seminaries are not ministers because the seminaries are not controlled by a specific church or denomination.
    http://www.aicpa.org/pubs/taxadv/jul2009/schloemer.pdf

  8. I think something that would clear all this up is if their was no paid ministry. Pastors could raise money through support or another income. This would free up a lot of funds that the church I’m sure could use in other ways. Plus the tension of saying the “right thing” “the right way” in order as to not offend ( or diminish giving) would be eliminated. There is nothing wrong with paid ministry but it might not be the best practice. Paul worked day and night as to not be a burden to the churches he visited. I know this is not going to be a popular stance but, I feel like it is the elephant in the room that no one will acknowledge.

  9. Paxton:

    That is an interesting comment. You rightly point to the upside, but the downside is that you tend to get what you pay for, and I fear that the quality of preaching and ministry in general would suffer if the pastor did not have sufficient time to study and prepare his sermons. We wouldn’t trust a surgeon or dentist who was supporting themselves by another line of work (and so didn’t have as much energy and time to devote to our surgery), and I think that the pastor’s job is even more important.

  10. Josh:

    Your comments are very helpful, and show that the issue has more shades of gray than I and Moore allow. But as you say, the bottom line is the same, that many ministers are lying to save a buck (okay, many bucks). As they said during the Clinton years (I think), it doesn’t pass the smell test.

  11. Excellent words here Mike and you give us much to think about. I wonder, what exactly is the ethical objection to public insurance in light of the following passages charging us with sharing with others? [Readers: Respectfully, please don’t merely respond by saying that’s the Old Testament and it does not apply to New Testament believers.]

    Leviticus 19:9-10
    When you reap the harvest of your land, do not reap to the very edges of your field or gather the gleanings of your harvest. Do not go over your vineyard a second time or pick up the grapes that have fallen. Leave them for the poor and the foreigner. I am the LORD your God.

    Deuteronomy 24:19-22
    When you are harvesting in your field and you overlook a sheaf, do not go back to get it. Leave it for the foreigner, the fatherless and the widow, so that the LORD your God may bless you in all the work of your hands. When you beat the olives from your trees, do not go over the branches a second time. Leave what remains for the foreigner, the fatherless and the widow. When you harvest the grapes in your vineyard, do not go over the vines again. Leave what remains for the foreigner, the fatherless and the widow. Remember that you were slaves in Egypt. That is why I command you to do this.

  12. Paul, a couple of things:

    (1) While these are commands given to all of Israel, they were individually followed. There is no State program here. The worst that would happen if a farmer decided to ignore this command was that villagers would just think he was a jerk. So, those veres cannot prove the legitimacy of a governmental aid program.

    (2). Still, I would argue that in the interest of justice the State has the right to assist with health/retirement benefits. Historically, however, the objection isn’t to public insurance/benefits. Most who would opt-out (for REAL religious objections) would have no problem with governmental programs such as Social Security. The issue here is whether or not a minister, whose livelihood comes from tithes and offerings given to the church (and which are already considered free from governmental oversight), should then appeal to the State for care. As the view goes, it would be the church’s job to care for its missionaries, evangelists, and elder/pastors.

    The issue isn’t “Separation of Personal Finances and State”, as many would like it to be; but rather”Separation of Church and State”.

  13. Darius,

    You wrote, “But generally, you are right, not many Christians have a truly conscientious objection to it. But they should start having one…”

    I would agree. It seems opting-out is the logical/theological conclusion of the “Separation of Church and State” position. Of course, if one denies the legitimacy of the separation of church and state then this isn’t an issue.

  14. Josh:
    Thanks for your thoughtful response. As for 1), I offer that any government state program finds its “legitimacy” in the biblical ethic “love your neighbor as yourself,” which is the heart of those passages I quoted from the OT. Thus, Social Security (though grossly mis-managed no doubt at times) does fall within this ethic as many elderly have only this resource to live.

    Re: 2) I would be hard-pressed to find a church that actually does take care of its elderly after retirement. That some do (Christian & Missionary Alliance, some Baptists, etc.) is the exception, not the rule. Therefore, most are left to the subsistence of Social Security in the latter years.

  15. “I offer that any government state program finds its “legitimacy” in the biblical ethic “love your neighbor as yourself,” which is the heart of those passages I quoted from the OT. Thus, Social Security (though grossly mis-managed no doubt at times) does fall within this ethic as many elderly have only this resource to live.”

    Except, Paul, that it steals from others to do this. Plus, the government pretends to be wiser than those elderly in the first place by taking their money and then giving it back to them later (though by then, it’s no longer their money but some other poor wretch’s). Social security, like most forms of socialism, are inherently evil and anti-Biblical. The Church is given the mandate to care for the poor and needy, not the government. To hand that responsibility over to the State is to subvert the role that God specifically and entirely entrusted to His people.

    The Church would take care of the poor and needy if the government didn’t undermine its ability and need to do so. The reason Americans give so much to charity and churches is due in large part to the fact that we’re not taxed as heavily as Europeans and Canadians. Taxes go up, charity falls. So we as believers should work to circumvent and dethrone the state as the god of this world and return people’s hope and sustenance to God and His Church.

  16. Mike:

    You do your own taxes? Wow, that’s impressive, or insane.

    Paxton:

    Besides Mike’s note about getting what you pay for, there is also the consideration that your proposal of ministers finding their own support outside the church is really just punting – at best it is trading one set of financial and tax issues for another. On your point about Paul, keep in mind that Paul did defend the right of both traveling evangelists (like himself) and local ministers to receive payment for their services. The significance of his rant about not accepting payment comes from the fact that this is the obvious exception, not a new standard. The tradition of supporting priests/ministers goes back at least to Melchizedek. It is confirmed by Moses and Jesus. Granted, there is abuse, but that doesn’t change the fact that Scripture makes several clear provisions for ministers.

  17. The analogy of getting what you pay for in terms of a doctor or dentist does not really hold water. A doctor is a doctor due to his specific training and certifications not where he makes his money. I would expect any doctor to be well rested before practicing regardless of his other vocation. Also financially a doctor is bound by the law to treat every patient the same regardless if they can pay or not. So getting what you pay for may apply to ministry but not doctors. Let me clarify. I am not saying that a pastor should have another full time job. I am saying that a pastor could be supported by funds that he raises separate from the church. I know this isn’t always ideal, and some situations it flat out would not work, but to say an all volunteer ministry is some how inferior to paid ministry is not accurate. The main point I wanted to make in my first comment was instead of debating of how the Government or the Church should best support pastors, maybe the pastors should deal with it like everyone else and increase the household income themselves. Then maybe they would not be tempted to break tax laws.

  18. I’m thinking I Corinthians 9 points to the responsibility a church has to support their pastor as able. As a pastor of a small church who does work a second job to make ends meet, I must say having a second job is much less than ideal for the church. How many opportunities for ministry are lost every week? And what are we freeing up funds in the church for? As for raising support – from whom? And when would I begin to find time in my 60 hour a week schedule for such activity?

    Brian

  19. Is this issue so black and white that we can act as someone else’s conscience? I opted out of SS 30 years ago, not for financial reasons, but because I did not believe that it was appropriate for a minister of the gospel to put himself in a position where the government could financially manipulate him to alter his message. The danger of that happening is all too apparent today when the preaching of certain passages of Scripture may be interpreted as a “hate crime”.

    A few years ago, my mission board, never understanding this part of the issue, followed a similar line of reasoning as you have presented and insisted that all its missionaries who had opted out, opt back in. I feel that it is a most regrettable position. I do not believe that one should feel guilty for being a conscientious objector when the law has provided for the objection. The day may soon be upon us when we wish that we were not dependent upon the government for our “social security”.

  20. Might help folks to have the actual text of the IRS provision in assessing your view on the matter:
    http://www.irs.gov/pub/irs-pdf/f4361.pdf
    http://www.irs.gov/publications/p517/ar02.html

    I encourage anyone wrestling through to make sure you are looking at the actual wording of the provision.

    “Conscientious objector” is not the only language of the exclusion.

  21. A couple thoughts…

    1. Social security is a wicked Ponzi scheme (as well as Medicare, Medicaid, and this next healthcare sham coming down the pipe)—it only benefits the current geriatrics and is helping to bankrupt this country. It cannot even be viewed as a legitimate retirement program because it isn’t, and thus it is a moot point trying to find legitimacy for it in the Word. Social security is not a retirement program; it is gov’t theft.

    2. The idea of a Pastor raising his own funds/working a second job is ridiculous—that is precisely one of the functions of the Church. If there is one group of people that should never have to worry about putting food on the table it is Godly Pastors.

    3. The IRS tax laws are absurd. Not one politician sat and poured over the nuances in wording for this particular code—it is a loophole just like the millions of others that were created with corrupt motives. Bottom line: the gov’t is giving clergyman an opportunity to opt out of a corrupt system. Almost all of those clergyman will opt out for purely economical reasons, but if there is one group of legitimate “conscientious objectors” it would no doubt be genuine Believers who see Social Security for what it really is.

    I guess this whole issue revolves around the question of what the gov’t means by “conscientious objector”—I can assure you it is much different than what it means to a Believer, but aren’t we supposed to interpret tax code on their terms?

  22. J. Gary Ellison:

    I am glad to know that you did not opt out for economic reasons, although your experience is not the norm. I am not sure how paying into social security makes you any more susceptible to being bullied by the government, so I don’t understand your reasoning. I would also say that your reason, while better than a purely economic argument, is not allowed by the IRS.

  23. Thanks for the post. I am finishing up a series on Our Attidude towards Government and was looking for the exact wording of IRS Form 517 for the lesson on “Our Responsiblities as Citizens”, and came across your blog post. I will reference this post in my footnotes as a must read for additional information.

    Thanks for a job well done!

    Ed

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