Hi, I’m an ordained pastor who began my job in 2024 and receiving W2, with salary and housing allowance (my sole income is from the W2). My employer (the church) asked payroll to withhold my Federal income tax (calculated using salary) + Social Security and Medicare taxes (15.3%, calculated using salary + housing allowance) all under Federal income tax withheld (box 2 on W2) and therefore I did not use 1040-ES to file my quarterly SECA taxes in 2024.
Due to inexperience (both my employer and myself), I was under the impression that the additional Social Security and Medicare taxes withheld under Federal income tax would’ve been “automatically moved/reassigned” to cover my SECA tax liability (boxes 3, 4, 5, 6 are all zero on W2).
Therefore, when I was filing my 2024 tax this year, when asked by TurboTax’s interview questions, “Now tell us about your clergy self-employment taxes. Your clergy housing allowance and wages are subject to Social Security and Medicare taxes (commonly called self-employment tax). How should we calculate these taxes?”, I chose the option “Social Security and Medicare taxes have already been withheld” and filed my taxes. I didn’t even know that a Schedule SE was not included by TurboTax.
Only when I was informed by SSA this month that I’ve never paid any SS & Medicare taxes in 2024 did I realize that I now owe SECA taxes for the entire year of 2024.
Is there anyway I can amend the 2024 tax to include Schedule SE so that the correct amount of the SECA taxes can be “moved/reassigned” from the already withheld Federal income tax to cover my SECA liability?
When I tried the Amend function in TurboTax, the only option I could find is changing my choice of the above mentioned TurboTax interview question “How should we calculate these taxes?” to “Pay self-employment tax on my wages and housing allowance.” But my question is: since I already had my SS & Medicare taxes withheld along with my Federal income tax, will this option calculate more SECA taxes than I should pay?
And honestly, I’m not even sure if this is the correct way to use the Amend function to address my problems.
I’m quite desperate as I know there will already be penalty on my SECA liability. Please let me know how I could proceed (with TurboTax) to address this issue. Your help is greatly appreciated!
