Clergy Act

This bill lets certain clergy who are currently exempt from paying Social Security and Medicare taxes on their ministerial earnings choose to opt back in. They can file to revoke their exemption and start paying these taxes going forward, which can make them eligible for Social Security benefits like retirement and survivors’ benefits based on future earnings after the change takes effect .

If you choose to opt back in, it will apply to either your first or second tax year that begins after December 31, 2027, and then continue every year after that. Once you opt back in, you cannot claim the exemption again later. If you make the change effective for a past year but file after that year’s tax return deadline, you must pay the self-employment taxes that would have been due for that year with your application. The IRS, working with Social Security, must create a plan to inform eligible clergy about this option.

• Who is affected: Duly ordained, commissioned, or licensed ministers, members of religious orders, and Christian Science practitioners who currently have an exemption from these taxes.
• What changes: They may revoke that exemption and begin paying Social Security and Medicare taxes on ministerial earnings; after revocation, they cannot re-exempt. Social Security benefits can then be paid based on earnings from the year the change takes effect and after .
• When: File no later than the tax return due date (including extensions) for your second tax year that starts after December 31, 2027. The change can take effect for either the first or second such year and all years after.
• If filed late for an effective past year: Include full payment of the self-employment taxes that would have been owed for that year.