SE Tax & Housing Allowance

by Jim Smith
(Groton, CT)

I am the Associate Pastor at our church. Although I meet the five criteria of a "minister", our church has treated me as an employee rather than self-employed. (When asked why this is the case, our Treasurer cites previous changes in the tax law, concluding that it's optional for any pastor other than the senior pastor of the church.). Therefore, the church withholds federal income tax, FICA & Medicare Tax, and state tax from my paycheck.

However, the church DOES provide me with a tax-exempt housing allowance. From what I read on this website, it seems to me that only self-employed ministers can receive a housing allowance.

Am I correct? Is the church inappropriately providing me with a a housing allowance? Would the way to correct while keeping my housing allowance be to treat/classify me as a self-employed minist?