wfn.org | Tax Status of Deacons in Question

[owner-umethnews@ecunet.org]

"UNITED METHODIST DAILY NEWS 97" by SUSAN PEEK on April 15, 1997 at 14:24
Eastern, about DAILY NEWS RELEASES FROM UNITED METHODIST NEWS SERVICE (288
notes).

Note 287 by UMNS on Aug. 28, 1997 at 16:19 Eastern (2422 characters).

Produced by United Methodist News Service, official news agency of
the United Methodist Church, with offices in Nashville, Tenn., New
York, and Washington.

CONTACT:  Joretta Purdue                          475(10-71B){287}
          Washington, D.C.  (202) 546-8722           Aug. 28, 1997

Deacons face confusion
in tax law, status

                 by United Methodist News Service

     Two agencies of the United Methodist Church have been working
on questions related to the tax status of people in the new order
of deacon, but the Internal Revenue Service (IRS) probably will
not decide how it views the order for another year or more.
     Although the church defines the deacon as one of two ordained
clergy categories, the IRS may not agree.
     Tax status determines whether deacons may treat housing
allowances in the same manner as elders and whether or not the
deacons must pay the employer's portion of Social Security as well
as the employee's.
     Staff of the denomination's Board of Higher Education and
Ministry and the General Council on Finance and Administration
(GCFA) have been working for several months to obtain a private
letter ruling on this issue and are sharing the legal costs.
     A local church with three deacons on its staff is serving as
the filing party.
     The confusion stems from the U.S. Treasury Regulations
definition of a minister's duties as "performance of sacerdotal
(priestly) functions."
     While diaconal ministers have been consecrated and defined by
the church as laity, the new order of deacon is ordained and
considered by the church to be clergy. Ordained elders administer
sacraments, and ordained deacons assist them in administering the
sacraments.
     Except for performing baptisms and administering the Lord's
Supper the duties of the two orders are substantially the same.
The request for a private letter ruling observes that "we are
aware of no case or ruling denying status as minister to someone
who was ordained as a minister and clearly regarded as such by an
established denomination."
     The two church agencies will make the IRS ruling throughout
the church, but that may take another 12-18 months they
anticipate. For now, the GCFA Legal Department recommends that
deacons obtain advice from their personal tax advisors about how
to file their taxes.
                              #  #  #

-----------------------------------------------------------------------

 To make suggestions or give your comments, send a note to 
 umns@ecunet.org or Susan_Peek@ecunet.org

 To unsubscribe, send the single word "unsubscribe" (no quotes)
 in a mail message to umethnews-request@ecunet.org

-----------------------------------------------------------------------