Trusting the Wrong “Expert” Costs Pastor Dearly

3/12/2020

Pastor Albright called the office to engage in what seemed “small talk.” Then he shares the story that has cost him more than he can afford to pay.

The conversation began with an exchange of niceties, but then abruptly changed. Trusting a “wrong authority” in 2002 had cost the Pastor his Social Security Benefits. In 2000, Pastor Albright trusted someone to opt him out of Social Security. Unfortunately, the source he had trusted, filed the wrong form. Instead of opting him out of paying Ministers’ self-employment tax, the “supposed expert” had opted him out of receiving Social Security Benefits.

What You Don’t Know Can Hurt You

Evidently, the individual had convinced Pastor Albright that the form and the process was simple—that anyone could do it.

Without knowing the nuances of the Internal Revenue Service (IRS) and how to properly navigate its paperwork “mine field,” the Pastor’s “trusted source” filed the wrong form. Any novice could have made the same mistake. Although the name of the two forms are different, a novice would look at the wording and not know there was a huge difference between the two.

Pastor Albright’s source apparently saw “Application for Exemption from Social Security and Medicare Taxes. . .” and assumed that was the form to use.

Pastor’s Dilemma

When Pastor Albright called my office, he wanted to be upset with us. He thought we were the ones that had made the error. In 2018, per his request, we filed the proper form to exempt him from paying any self-employment tax.

He explained that he was at the Social Security Administration and they explained to him that he could not receive any Social Security Benefits because he had exempted himself from them.

As we do with every case, we spoke with the Social Security agent to determine the problem. It was then we learned that someone for Pastor Albright had filed the wrong form in 2000. They had taken this action 16 years prior to the Pastor becoming our client.

The Social Security Agent told the Pastor that we had filed the correct form and our action was not his problem. His problem was trusting someone who convinced him that he did not need professional assistance from a real authority. Three wrong numbers cost Pastor Albright a small fortune that cannot be reversed, fixed, or amended.

Unless Pastor Albright has made some very wise financial decisions in the past 30 years of his life and built a comfortable financial nest-egg, he will be forced to work for a paycheck all the days of his life. Because he is locked out of any Social Security and Medicare Benefits, he will never be able to enjoy retirement, and will struggle to survive the rising costs of health care.

Anyone CANNOT Do What We Do

Chitwood & Chitwood has been the Real Authority for non-profit, Church, and Clergy Tax issues for more than 80 years.

Our experts know the forms to use, the words to say, and the actions to take to limit liability to those we represent. Unfortunately, people who are too cheap or naïve to retain our services, think that it is as simple as getting a form and reading the directions.

Just because there are some directions does not mean that anyone can properly understand and implement them. Jet engines have tech manuals, but unless you are a qualified jet engine mechanic, I would not want to fly on a plane where you worked on its engines. Anyone can tinker, but it takes an expert to know where and with what to tinker.

All Pastors and Church Officials Need to Attend our Next Seminar

We conduct live seminars across the nation. At these seminars, Pastors, Trustees, Board Members, and Checkwriters can easily ascertain the difficulty involved with Church Books and Records.

Don’t assume you or anyone in your Church knows how to properly maintain your Church Books or navigate the stormy waters of the IRS.

I encourage every Pastor, Trustee, Board Member, and Church Checkwriter to call 800-344-0076 or visit us at www.cmtc.org and register for our next seminar. Pastors DO NOT only send your Board Members and You MUST ALSO ATTEND.

Just like Pastor Albright, you listened to others, and you think everything is okay, but there will come a day when you will give an account. Fix it now before it is too late.

By Dr. Michael Chitwood

What You Will Learn at our Conferences

Our Church Management Conferences will arm you with the information you must have to shield your Church or Ministry from IRS intrusiveness; teach you how to get your Taxes to the lowest possible rate; and daily operate your Church or Ministry within IRS acceptable guidelines.

Our Conferences have been taught across the Nation for over 48 years. Because of the Penalties, Fines, and even Imprisonment that the IRS imposed on many Churches and Pastors, Dr. Chitwood felt led by the Holy Spirit to become a buffer between Churches, Ministers, and the IRS.