Forms 5, 6, 7, 8a, and 8b (Clergy Compensation) in PDF Format

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Minnesota Annual Conference of The United Methodist Church Church Conference Forms 122 W. Franklin Ave. #400, Minneapolis, MN 55404 612-870-0058; info@minnesotaumc.org parsonages. Each year the penalty adjustment will be calculated by the Benefits Officer using the average housing allowance of fulltime Minnesota appointments and average parsonage value (25% of salary). The fulltime parsonage penalty adjustment calculation is: 3% of the difference between the average housing allowance and average parsonage value. For less than fulltime appointments with a parsonage the penalty adjustment will be the incremental proportion of the appointment to the fulltime penalty adjustment, 75%, 50% or 25%. The penalty adjustment does not apply to retired supply appointments. 2013 Parsonage Penalty Adjustment amounts are: Fulltime appointment = 274.10 ¾ time appointment = 205.57 ½ time appointment = 137.05 ¼ time appointment = 68.52 Note: Clergy waiving participation in the UMC pension plan or retired clergy serving an appointment are not eligible to receive the Parsonage Penalty Adjustment. Line 1c) Salary Reductions: Once the base cash compensation is determined, the pastor may choose to participate in voluntary reductions to; (1) ___ United Methodist Personal Investment Plan (UMPIP), (enrollment form required) (2) ___ Other 403(b) plan (not UMPIP) not recommended due legal requirements for the local church (3) ___ Furnishing/Appurtenance Allowance, (Resolution must be approved by church or charge conference) (4) ___ Clergy Share of MAC Premium (10%) – mandatory if participating in MAC Plan (5) ___ Medical Reimbursement (IRC 125) SelectAccount Plan (enrollment form required) (6) ___ Dependent Care Reimbursement (IRC 125) SelectAccount Plan (enrollment form required) Please note: The amounts listed on this form do not complete the process, enrollment forms are necessary. The 2013 contribution limits to 403(b) plans have not been released by the IRS at this time, the limits are indexed to inflation and will be announced by the IRS in the fourth quarter of 2012.The 2012 maximum contribution limits to 403(b) plans are $17,000 for taxpayers under age 50, and an additional $5,500 catch-up option for taxpayers 50 and older. Each situation is unique, so please consult your tax advisor. Line 2) Housing Allowance: This is for churches that do not provide a parsonage. The amount would have been set when the appointment was made or when the pastor moved from a parsonage to a housing allowance. It should not change from year to year unless there is an increase in utility costs. Even if the amount of the cash housing allowance does not change, a new housing allowance declaration is required when there is a change in pastors. The housing allowance declaration of the previous pastor does not apply to the new pastor and the new pastor’s housing allowance declaration from the previous church does not apply to the new appointment. The pastor may choose to shift more
Minnesota Annual Conference of The United Methodist Church Church Conference Forms 122 W. Franklin Ave. #400, Minneapolis, MN 55404 612-870-0058; info@minnesotaumc.org of their salary into their housing allowance for tax purposes, that would be shown on the housing allowance form approved by the church conference, and not here. Sample forms are numbered 8a and 8b. Keep the approved Housing Resolution with the church conference minutes. Line 3) Health Insurance: The 2013 MAC Plan premiums was determined at the September 11, 2012 Conference Board of Pension and Health Benefits meeting, there is no change in the premium for Active Clergy and Lay employee premiums, the 2013 premium is the same as 2012. The church pays 80 percent, the conference 10 percent for appointments of ¾ time or more, and the clergy 10 percent, or 20 percent if less than ¾ time appointment. Automatic withdrawal is available and does save the church money. It is mandatory for elders and provisional elders who are appointed full or ¾ time to be on the conference plan. Line 4) Pension (CRSP) and Death & Disability (CPP or UNUM) coverage: Please note that there is a maximum contribution for the CRSP pension and CPP disability plans and they are not based on the same compensation amount. Use the salary amount before salary reductions plus the parsonage penalty adjustment (lines 1a plus 1b) in the calculations along with the housing value. Both the CRSP and CPP or UNUM premiums are paid by the church, and are billed by the Minnesota Annual Conference. The UMPIP is a voluntary contribution by salary reduction pension program. If your pastor has elected to contribute to UMPIP the lead church will be billed separately by the General Board of Pension, and is to be paid by the church from monies withheld from the pastor’s salary. Less than full-time appointments: Adjustments are made to salary, housing, pension, and health insurance for less than full-time appointments. Please be in conversation with your district superintendent about your particular situation. W-2 reporting update: Health care reform and W-2 reporting information: (From the General Board of Pension and Health Benefits website) Background The Patient Protection and Affordable Care Act (PPACA) requires employers to report the aggregate cost of employer-provided health care coverage on employees’ Forms W-2. Initially this requirement was to be effective for the 2011 tax year—which means the information would have been required on Forms W-2 issued in January 2012. As posted previously, Notice 2010-69 issued in October 2010, made this requirement optional for all employers for the 2011 tax year Forms W-2 (furnished in January 2012). Extended Relief for Smaller Employers IRS Notice 2011-28, released in March 2011, provides further relief for smaller employers that issue fewer than 250 Forms W-2. This requirement is optional for such employers for the 2012 tax year (i.e., Forms W-2 furnished in January 2013) and will continue to be optional for smaller employers until the IRS issues further guidance. This means smaller employers (with fewer than 250 Forms W- 2) will not be required to provide health care coverage cost information on employees’ Forms W-2 any earlier than January 2014. Extended Relief for Certain Types of Coverage Notice 2011-28 provides additional temporary exemption with respect to certain types of employersponsored coverage. This transitional relief will continue at least through the 2012 tax year (for Forms W-2 due in January 2013), or until the IRS issues further guidance.
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Forms 5, 6, 7, 8a, and 8b (Clergy Compensation) in PDF Format

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