Contents Introduction  ........................................ 1 Social Security Coverage  .................. 2 Exemption From Self-Employment (SE) Tax  ........................................ 3 Qualified Services  .............................. 5 Figuring Net Earnings From Self-Employment for SE Tax  ...... 5 Income Tax: Income and Expenses  . 7 Filing Your Return  .............................. 8 Retirement Savings Arrangements  .. 9 Earned Income Credit  ........................ 9 How To Get More Information   .......... 9 Comprehensive Example   .................. 10 Index  .................................................... 20 Important Changes for 1999 Photographs   of   missing   children. The Internal Revenue Service is a proud partner with the National Center for Missing and Ex- ploited   Children.   Photographs   of   missing children selected by the Center may appear in this publication on pages that would other- wise  be  blank. You  can  help  bring  these children home by looking at the photographs and calling  1–800–THE–LOST (1–800–843– 5678) if you recognize a child. Increased self-employed health insurance deduction. The self-employed health insur- ance deduction increased from 45% to 60% of the cost of the insurance. See  Health In- surance Costs of Self-Employed Ministers. Introduction Social security and Medicare taxes are col- lected  under  two  systems.  Under  the  Self- Employment  Contributions  Act  (SECA),  the self-employed person pays all the taxes. Un- der the Federal Insurance Contributions Act (FICA), the employee and the employer each pay half of the taxes. No earnings are subject to both systems.   This publication covers the following top- ics about the collection of social security and Medicare taxes from members of the clergy and religious workers: •  Which earnings are taxed under SECA and which under FICA, •  How a member of the clergy (minister, member of religious order, or Christian Science practitioner) can apply for an exemption from self-employment tax, and •  How to figure net earnings from self- employment. This   publication   also   covers   certain   in- come tax rules of interest to the clergy. A comprehensive example shows filled-in forms for a minister who has income taxed Department of the Treasury Internal Revenue Service Publication 517 Cat. No. 15021x Social Security and Other Information for Members of the Clergy and Religious Workers For use in preparing 1999  Returns