Question about minister's W2 form

[Mintipine]

Hello, I was wondering if I could receive insights in regards to the W2 that I have received for the tax year 2021.

To give you the background information, I am a minister at a fairly new ministry, and our finance department outsources our paystub and tax work to the outside firm.  I have been receiving MHA under a clergy employment, and my 2020 W2 had amounts shown in boxes 3 and 5 with withholding amounts showing in boxes 4 and 6, and my 2021 W2 still has amounts showing in boxes 3,5,4, and 6.  (I heard this shouldn't be the case for clergy W2 but this was/is what I have been getting for the year 2020 and 2021...)

1st question: My understanding was that if any withholding amounts are in the line 4 and 6 of my W2, it means that my ministry is following FICA standard (Otherwise it would not balance out I heard when my ministry sends in the documents to IRS).  However, our outsourced firm is insisting that we are actually following SECA standard.  Is it possible for them to follow SECA standard yet have withholding amounts for Medicare and Social Security show on lines 4 and 6?  I want to make sure since this would determine which button to click when I get to "clergy employment" section.  I understand that if they did FICA, I just need to click "pay self employment tax on my housing allowance" but if they did SECA I would need to click "pay SE tax on my wages and housing Allowance"

Question #2: We started 401K last year so my box 12 has "D" with the retirement amount showing there.  So my box 1 correctly displays the amount which equals to "Total wage - MHA amount - Box 12D amount = Amount shown in box 1" 

However, my understanding from researching online is that on boxes 3 and 5 should show the amount that is "Box 1 amount + Box 12D amount = Box 3 and Box 5 amounts" Since even though amount in 12D is not taxable for federal income, but I still have to pay Medicare and social security taxes for Deferred retirement plan contributions.  So in my case is it true that boxes 3 and 5 should be higher than the box 1 on my W2?  Or will Turbotax automatically add the amount in 12D in calculations later if I enter it at the beginning while I go through W2 information section?  Currently amount shown in Boxes 3 and 5 is actually little lower than box 1.  Our outside firm handling our paychecks is saying that this is normal and I should just go ahead and file my return with the current W2, but I am confused because it is opposed to what I have found out in my own research.

Thank you everyone for sharing your insights!  This forum has answered lot of my questions in the past that made my tax filing process to be bearable 🙂 

[RobertB4444]

1-No, SECA would have no amounts in boxes 3 through 6 so you would be required to pay both halves of the self employment tax.  You are on a FICA standard because they are taking social security and medicare payments out of your check.  You already know that you owe SE tax on your housing allowance.

2-It depends on the type of retirement plan that you have.  You should look at the type of retirement plan that the church is giving you.  A traditional 401k would raise the amount in boxes 3 and 5 by the amount on 12D as you figured so the retirement plan is not a traditional 401k.

However, the outside firm is correct.  You should enter the W2 exactly as it has been issued to you because that is what the IRS has.  They will kick back your return if it doesn't match.  I would continue to question the payroll, however, because it doesn't sound like they're doing it correctly.