W2 that maxes out social security taxes and additional non profit parsonage income that needs to pay only medicare.

[user59912]

I have a job that pays me on a regular w2, for which I paid full max social security taxes ($7,886.40). I also get parsonage from a non profit for which I work. When I enter my info for the Clergy Self Employment Tax, it gives me 5 options.

None of which is to pay only Medicare taxes.

I already paid the max social security taxes, and if I select Pay self employment tax on housing wages and housing allowance it deducts social security and medicare. it should only deduct medicare bc social security is at max.

[Opus 17]

Are you sure that it actually puts the social security part on schedule SE?  If you already entered your W-2 and then indicate you have religious wages subject to SE tax on wages plus housing, the schedule SE itself should recognize the situation and only apply Medicare.  

If you are working with Turbotax online, you probably can't see schedule SE to confirm this until you pay to file.  You may want to use the desktop program installed on your own computer which allows you to examine all the forms and worksheets at any time.  

Incidentally, just because you work for a non-profit doesn't mean you can have a tax-free parsonage, nor does having religious credentials if you aren't using them in your present job.  You must be actively performing religious duties in your job, such as conducting worship services and administering the sacraments.

[user59912]

It reduces my refund my a nice number, more than makes sense for just Medicare.

Is there a way to get a breakdown of what it removes?

I have the desktop version.

My particular work for the non profit as a ordained person in this case does qualify for Parsonage. I confirmed that with several lawyers and accountants over the years.

[TaxGuyBill]

Print out the tax return with the Parsonage, then print it out again without the Parsonage.  Look at which lines on the 1040 change.  If you have questions about that, post which lines change.

[user59912]

I did that.

Difference in refund with and without: $1285

$  608 - Line 27 - Deductible part of self-employment tax. Attach Schedule SE
$1216 - Line 57 - Self-employment tax. Attach Schedule SE
$  267 - Line 62 - Taxes from: a Form 8959 (Additional Medicare Tax)

[TaxGuyBill]

That does seem high.  How much is the Parsonage amount?

[user59912]

45,400.00

[TaxGuyBill]

Wow, that is a large Parsonage.  Therefore, it seems about right.

'Regular' Medicare taxes for self employment is 2.9% (after an adjustment by 92.35%).  So the Medicare calculation is $45,600 x 92.35% x 2.9% = $1216.

The Additional Medicare tax is 0.9%.  So that would be $409, but your income could be on the border so it may not all be subject to that, which is why you are paying LESS than that.

[user59912]

The parsonage is that high because it includes a down payment.

While I am not happy I got to pay that more than expected, I am comfortable knowing that the numbers are correct and I am paying my correct share.

Thanks for your help and your follow ups.

[Opus 17 · Accepted solution]

As I mentioned originally, you can switch to Forms mode and print your "Schedule SE Adj Wks" (schedule SE adjustment worksheet), and Schedule SE.  Your religious income is on line 5a of the adjustment worksheet and the parsonage allowance is on line 5b or 5c.  That information flows to schedule SE, where you need to look at page 2 (Section B, the long form) to follow the calculation; your religious wages and parsonage allowance are on lines 1-6, your social security annual limit is accounted for on lines 7-9, and the additional medicare tax is calculated on lines 10-12.  Those numbers flow to your form 1040.