INTRODUCTION
This pamphlet is intended to aid Sessions and others responsible for compensation of clergy in understanding compensation issues and in making decisions that are acceptable to everyone concerned.
Book of Order Requirements
Our Book of Order requires (G-2-0804)
- The terms of call shall always meet or exceed any minimum requirement of the presbytery.
- The session shall annually review the terms of call and shall propose for congregational action such changes as the session deems appropriate.
- The call shall include participation in the benefits plan of the PC(USA) including both pension and medical coverage.
Presbytery Requirements
The Presbytery annually on recommendation of the Commission on Ministry adopts minimum compensation standards. For full time installed positions in 2018, these include:
1. Salary for Clergy:
(a) If a manse is provided - $38,403
(b) If no manse is provided - $49,982
including the amount designated as housing allowance.
Minimum salary for CRE’s - $38,147
2. Vacation of 30 days per year.
3. Continuing Education minimum of two weeks at $500 per year, which can be accumulated for three years totaling 6 weeks and $1,500.
4. Reimbursement of professional expenses.
Board of Pension Requirements
The Board of Pensions requires that:
1. If a manse is provided, its value (including utilities) for calculating benefit plan dues shall be at least 30% of the cash salary.
2. Dues must be paid on any deferred compensation or other compensation such as annuities and Social Security offsets in excess of 50% of liability.
3. If a clergy is not reimbursed for professional expenses on a vouchered basis, the amount paid must be considered compensation and dues must be paid on it. (ex: if a minister is given a flat amount for automobile expenses and not required to account for how it is spent before the allowance is paid, it must be counted as income and included in the amount on which dues are paid.) The easiest way to avoid this situation is to reimburse expenses monthly on the basis of a signed voucher.
4. The medical portion (25%) for minister is based on full time salary. The pension portion (11%) is on the actual amount for
Total Effective Salary as is the Death and Disability portion (1%).
IRS Requirements
1. Money paid to a clergy to provide housing, including furnishings and utilities, is not reported as income to IRS, provided the amount 1)is recorded in the official Congregational minutes prior to the first payment, 2)spent on housing, 3)does not exceed the fair rental value of the house.
2. Money paid to a clergy as reimbursement of expenses incurred and documented to the church is not reported as income by either the clergy person or the church on form W-2.
3. Money paid for reimbursement of expenses not vouchered must be reported as income, but may be deducted by the clergy person as a miscellaneous deduction on their income tax return, to the extent that they can document the expenses. It is to everyone’s advantage to reimburse clergy for expenses actually incurred on a voucher system. The amount of reimbursement may be limited to an agreed upon budgeted amount.
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In the event that a congregation is unable to meet the minimum salary as outlined above, the Commission on Ministry will work with that congregation to develop alternative leadership plans. Revised 10/17
Effective Salary Worksheet
Salary (Excluding housing) $______
Manse (=30% of line 1)
OR $______
Housing Allowance
Other Compensation (annuities,
soc. sec. offset, etc.) $______
TOTAL $______
Less 7.65% of total for
S.S. Reimbursement $______
TOTAL FOR BOP $______
Benefit dues @ 37% of
above total $______
(11% pension, 1% disability, 25% medical
Medical is based on full time equivalent
salary)
Budgeted amount for
reimbursement of
vouchered expenses $______
Professional Expenses $______
Auto Expenses $______
Continuing Education $______
Continuing Education time ______
Vacation time ______
A GUIDE TO
CLERGY & CRE
COMPENSATION
2018
PRESBYTERY OF THE
INLAND NORTHWEST