SS Policy Questions – Social Security Intelligence

Yes. If you meet the qualifications.

You must be either a member of the clergy or a member of a recognized religious sect (ex. Amish & Mennonite).

There are some differences in the rules for these groups but either way you have to agree to language that you are opposed to “any public insurance that makes payments in the event of death, disability, old age, or retirement; or that makes payments toward the cost of, or provides services for, medical care.”

You cannot opt out solely for economic reasons.

For ministers, you have to submit Form 4361 by the due date (including extensions) of your income tax return for the second tax year in which you had at least $400 of ministerial earnings.

Fortunately, if you’ve already paid in enough FICA/SECA taxes through other work to qualify for benefits, you’ll still be able to receive them.

Members of certain recognized religious sects (ex. Amish, Mennonite) will use Form 4029. One of the key differences for a member of a religious sect is that you must waive all rights to future benefits. This means that even if you have already paid in enough taxes to qualify for benefits, you WILL NOT receive those benefits.

The IRS Form for religious sect members requires you to acknowledge [in bold print], “I waive all rights to any social security payment or benefit under Titles II and XVIII of the Social Security Act. I understand and agree that no benefits or other payments of any kind under Titles II and XVIII of the Social Security Act will be paid based on my wages and self-employment income to any other person. I certify that I have never received benefits or payments under the above titles, nor has anyone else received these benefits based on my earnings.”

Needless to say, opting out is a BIG step that you need to take with a lot of care and planning. Remember, this is not just a future retirement benefit you’re opting out of, but a benefit if you become disabled, benefits for your family if you die, and benefits that will pay for your healthcare (Medicare).

Check out my article and IRS Publication 517 for more information.

Here are a few other links that may help:

SSA Website
Are members of religious groups exempt from paying Social Security taxes?

Yes. I know…this is a term that can get some people really fired up. I can understand why. After all, the term entitlement has taken on a demeaning definition that insinuates getting something that you haven’t earned or maybe even deserve.

Here’s the truth…the federal government has referred to Social Security as an entitlement program for several decades. On their website you can hundreds of uses of the word. In fact, they go so far as to explicitly state “The social security benefit programs are entitlement programs.”

So why do they refer to it this way and does it have a negative connotation?

If you examine the definition of the word entitlement, you’ll see there is no mention of welfare, charity or handouts.

The Merriam Webster dictionary defines it as: “A government program providing benefits to members of a specified group.”

The Cambridge dictionary defines it as “something, often a benefit from the government, that you have the right to have.”

In then in the glossary of the United States Senate the word entitlement is defined as, “a federal program or provision of law that requires payments to any person or unit that meets the eligibility criteria.”

The fact is, the phrase “entitlement program” is simply a term for any government program guaranteeing certain benefits to a segment of the population who qualify for them under specific terms and conditions.

That’s exactly what Social Security is. You have to work for at least 10 years with a certain amount of earnings to be ENTITLED to your own benefit.

But in the highly politicized world that we live in, what words actually mean and the meaning given to words aren’t always the same.