How to include Pastor on 941 form when Federal taxes have not been withheld

There is no requirement to include a Pastor's salary on the 941 form if no Federal taxes have been withheld. If this is the case, and the Pastor is the only employee, then the 941 is not required to be filed.

However, if you want to include the Pastor on the 941 even though no Federal taxes have been withheld, then do the following:

  • Click SETUP from the Payroll screen
  • Select the Pastor's name in the box on the left
  • Click the TAX WITHHOLDINGS tab at the upper-right
    Setup Pastor Tax
  • Double-Click the left column next to FEDERAL(USA)-INCOME TAX. An "X" should appear.
  • Click the TAX EXEMPT box. It should have a Checkmark in it.
Setup Pastor Tax

The Pastor's salary will now be included on the 941 form - box 2, and they will also be included in box 1 when applicable.

The information contained in this web page is of a general nature. It is not offered as specific legal or tax "advice." Each person, local church, and district should evaluate their own unique situation in consultation with their local legal and tax advisors. We are not responsible for the accuracy of information on other web sites including sites linked to from this page.