IRA for member of religious order who opted out of FICA

Submitted by Jeff Beebe on Wed, 2018-04-04 01:13

A client is a member of a religious order who opted out of FICA taxes using form 4029 many years ago. He’s considering starting an IRA, but heard somewhere that if he opens an IRA he’ll have to pay back all the years of FICA taxes that he opted out of. I haven’t been able to find any guidance on this. Is anyone familiar with the rules for those who have opted out of FICA? He’s self employed, so he’s basically opted out of paying SE taxes.



Submitted by Alan - IRA critic on Wed, 2018-04-04 04:06

I can’t locate any evidence of client’s IRA contribution resulting in having to pay SE tax. If that were true, how could an IRA contribution be made for those who have opted out of SE taxes if the contribution meant they opted back in?

Submitted by Jeff Beebe on Wed, 2018-04-04 16:45

I agree, but can’t find anything definitive. There doesn’t seem to be much in the way of resources for guidance for those who have chosen to opt out.  Thanks!

Submitted by William Tuttle on Wed, 2018-04-04 19:46

  • I think you must be confusing this with receiving SS benefits or enrolling in Medicare. There is absolutely no connection between Social Security/Medicare taxes and IRA contributions.
  • There never was or is any restriction on government employees who didn’t/don’t pay SS taxes.

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