Unemployment Taxes and Churches
By Richard R. Hammar, J.D., LL.M., CPA
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As has been noted elsewhere,1 service performed in the employ of a church or other religious organization is not subject to the federal unemployment tax provisions. In addition, nearly every state unemployment tax law specifically exempts churches from the tax by excluding “services performed in the employ of a church” from the definition of employment.
For related information on this topic see the following articles:Federal Income Taxation of Churches