With the implementation of the Patient Protection and Affordable Care Act (also known as the Affordable Care Act), I have had several people ask me about how the Act mandates may affect ministers who have an IRS-approved Form 4361 (the form ministers use within the first two years of ministry to opt out of Social Security and Medicare). Does a minister's IRS-approved Form 4361 also exempt them from the Affordable Care Act?
I addressed this in my full analysis of the Affordable Care Act available in the CHURCH LAW & TAX REPORT archives on ChurchLawAndTax.com:
For many years the tax code provided ministers with a limited opportunity to exempt themselves from paying self-employment (Social Security and Medicare) taxes on their ministerial income by filing a timely exemption application (Form 4361) with the IRS. A minister certifies on Form 4361 that "[he or she is] conscientiously opposed to, or because of [his or her] religious principles … opposed to, the acceptance (for services [he or she] performed as a minister … ) of any public insurance that makes payments in the event of death, disability, old age, or retirement, or that makes payments toward the cost of, or provides services for, medical care."