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Welcome to the Diocese of Maine Payroll Program On-line
On this section of the website you will find everything your
congregation needs to know,
(and all the forms), to participate in the payroll program. The forms are available
for printing as .pdfs.
To print them you will need Acrobat Reader, a free program installed on most computers.
If you don't have it, click on the button above to download a free copy.
Diocese of Maine - Central Payroll Program - 2004
On this site you will find enrollment forms and instructions for the Diocesan Central Payroll Program. The diocesan office currently processes payroll for more than 30 Maine congregations. We have many happy "customers" - treasurers and administrators across the diocese who enjoy the benefit of being "out of the payroll business". If your congregation is interested in participating, please feel free to copy these forms for as many employees as you have or contact us and we will send out the number of enrollment packets that you require. We welcome congregations who employ hourly employees.
The Diocesan Central Payroll Program was begun several years ago to serve our congregations by providing an economical payroll service process. The benefits to your congregation of having all of your employees on the Diocesan Central Payroll Program are many. For the fee of $62.40 annually per employee, we prepare all paychecks, file quarterly 941 reports, deposit payroll taxes and prepare W-2s at year-end. Basically, if all of your employees are on this program, you simply send a check to the diocese every two weeks and you have no other payroll responsibilities. We also offer and encourage direct deposit for your employees (please see section 4 of the instructions) and direct debit of your payment to the diocese.
In addition, employees participating in Central Payroll have the ability to take advantage of the Diocese of Maine - Section 125 Cafeteria Plan; medical and dependant care pre-tax deductions, pre-tax medical insurance premium deductions (there are additional costs to participate in the cafeteria plan – please see section 1 of the instructions.) Click here for more information on Diocesan Insurance programs.
1. CENTRAL PAYROLL SERVICE AGREEMENT
The Central Payroll Program is operated by the Diocese as a payroll service to the congregations with the understanding that:
Each participating church reimburses the Diocesan office for all clergy and lay salaries and the employer's share of lay FICA (Social Security and Medicare) tax (7.65%) disbursed on its behalf, such reimbursement being received before any payroll will be issued.
Each participating church will pay the Diocesan office $2.40 per payroll check or direct deposit.
The cost of participating in our cafeteria plan is $2.42 per pay period per employee per account. In other words, if your employee wants a medical reimbursement account, the annual cost to the congregation is $63.00. This fee is not kept at the diocesan office, but paid directly to Group Dynamic, the third party administrator of the reimbursement accounts.
Written notice of all changes is required (email is fine). It is necessary that the payroll department (Lou-Ann Milton - lmilton@diomaine.org ) be informed of all payroll changes: salary increases, new employees, terminations, changes in status, etc. All such notices should be received at the diocesan office not sooner than 30 days or later than 7 days before the effective date. The Diocesan office assumes no responsibility for overpayment to any person unless written notice has been received 7 days in advance of the day the pay period ends. A notice of change received after a payroll is issued will not be processed until the next payroll is issued. Payroll adjustments can be retroactive. Please note that notification to the Bishop's office is not the same as notifying the payroll department.
3. I-9 and W-4 WITHHOLDING FORMS AND INSTRUCTIONS
(Form I-9) must be completed for each new employee.Federal and state withholding forms (W-4 and W-4ME) are required for all new employees or employees wishing to change their withholding status. All new employees, including clergy, must complete the W-4 forms. If a clergyperson does not want federal taxes withheld, he/she should write "no withholding requested" on Line 7 (of the federal W-4), sign and date the form. Please make a similar notation on the state W-4ME form.
Federal and state withholdings will be calculated on the basis of an individual's withholding status (single, married), the number of exemptions listed on the Form W-4, and the salary paid by the church without regard to other income. Persons requiring additional withholding are advised to revise the W-4 on file at the diocesan office.
As clergy will be issued W-2s at year-end, they are considered employees of their congregations for Federal Tax purposes. As employees, they may elect to have federal and state income taxes withheld by filing a W-4 form - this is considered as voluntary withholding but can eliminate the need for quarterly filing if the correct amount of withholding is requested.
Employment Eligibility Verification
4. DIRECT DEPOSIT and DIRECT DEBIT
Direct deposit has been in place since the beginning of 2001. It is the most convenient and safest way to receive paychecks. We strongly encourage direct deposit for all employees. Delays by the postal service are beyond our control and can be avoided by using direct deposit. If direct deposit is not chosen and your check is lost in the mail, we require a 7 day (from mail date) waiting period before a payroll check will be reissued. For example, if your check was mailed on a Wednesday you will not have a check reissued until the following Wednesday. Payroll funds can be deposited into either a checking or savings account and will be credited to each employee’s bank account on the designated day – no waiting on the Postal Service. To enroll, please complete and return the Payroll Direct Deposit Authorization form. A voided check MUST be attached to the authorization form.
Please note - if your employee already participates in direct deposit, this form does not need to be completed again.
We also offer direct debit – a program where congregations can authorize the diocesan office to debit their checking account for the exact amount of their payroll on the same day that payroll is processed. This avoids the worry of making sure the check is mailed in enough time to arrive here before the deadline. We have many satisfied congregations using this service and would be happy to provide references should you wish to talk to another congregation about this process. A Payroll Direct Debit form is included in this packet. A voided check MUST be attached to the authorization form.
Please note – if your congregation already participates in direct debit, this form does not need to be completed again.
5. FICA TAXES (Social Security and Medicare)
a. LAY FICA
It is the responsibility of every employer to withhold social security taxes from the wages paid to each (lay) employee in excess of $100.00 per calendar year. The rate for social security tax will be 7.65% for lay employees. This tax consists of 6.2% for Social Security and 1.45% for Medicare coverage.
b. CLERGY FICA
For purposes of FICA taxes, clergy are considered to be self-employed and, therefore, subject to a 15.30% rate. According to Canon, clergy must be reimbursed for 1/2 of the self employment tax (7.65% - which is comparable to the employer's portion of lay FICA tax). Calculate the FICA reimbursement as follows:
WITH Rectory:
(Salary + fair rental value* of Rectory + utilities) X .0765 = FICA reimbursement
* = Fair Rental Value = what it would cost someone in your area to rent the Rectory. The IRS may check this rental value, so be sure to estimate the fair rental value. It is recommended that you obtain a professional opinion of this value from a realtor or other qualified individual.
WITHOUT Rectory:
(Salary + Housing + Utilities Allowance) X .0765 = FICA reimbursement
This amount should be recorded on Line b of the Payroll Enrollment/Change Form.
We will be remitting payroll bi-weekly. Each pay period will end on a Sunday (every other week). Payroll will be processed the following Tuesday and mailed on Wednesday. Direct deposit employees will receive their pay on Thursday of EVERY other week. In the event that the week following the end of a pay period has a holiday on Thursday, the payroll processing schedule will move back one day so that paychecks will be mailed and direct deposits processed one day sooner.
In order for paychecks to be remitted promptly to the employee, funds MUST be received in the diocesan office by every other Tuesday (see below).
Pay period ends
Remittance due in Diocesan Office
Payroll mailed
Direct Deposit received by bank
January 11 January 13 January 14 January 15 January 25 January 27 January 28 January 29 February 8 February 10 February 11 February 12 February 22 February 24 February 25 February 26 March 7 March 9 March 10 March 11 March 21 March 23 March 24 March 25 April 4 April 6 April 7 April 8 April 18 April 20 April 21 April 22 May 2 May 4 May 5 May 6 May 16 May 18 May 19 May 20 May 30 June 1 June 2 June 3 June 13 June 15 June 16 June 17 June 27 June 29 June 30 July 1 July 11 July 13 July 14 July 15 July 25 July 27 July 28 July 29 August 8 August 10 August 11 August 12 August 22 August 24 August 25 August 26 September 5 September 7 September 8 September 9 September 19 September 21 September 22 September 23 October 3 October 5 October 6 October 7 October 17 October 19 October 20 October 21 October 31 November 2 November 3 November 4 November 14 November 16 November 17 November 18 November 28 November 30 December 1 December 2 December 12 December 14 December 15 December 16 December 26 December 28 December 29 December 30 If remittance from congregation is not received on time, payroll will not be issued and missed payroll checks will not be issued between the regular payroll dates.
Please send a 2004 Payroll Enrollment Form to the diocesan office for each employee that you wish to remain on the Central Payroll Program by December 12, 2003. We have no way of knowing that you wish to continue paying your employees through this program unless we hear from you.
9. EMPLOYEE CONTRIBUTION OF INSURANCE PREMIUMS
If your employee has medical/dental insurance premiums withheld from their paycheck, a check in the amount of the total withheld will be sent from the diocesan office to the church on a quarterly basis. Insurance premiums and pension assessments will continue to be paid by the congregation.
10. EMPLOYEE CONTRIBUTION TO PENSION FUNDS
Employees may contribute to a qualified 403(b) pension program of the employee's choice. These contributions will be deposited into the employee's account monthly.
11. DEPENDENT CARE AND MEDICAL REIMBURSEMENT ACCOUNT WITHHOLDING
These amounts will be sent to Group Dynamic, Inc. by the Diocesan office after each payroll for credit to the employee's account. These amounts may not be changed during the plan year (1/1-12/31/04) unless you have a qualified family status change. It is also important to note that monies set aside in Section 125 Cafeteria plans must be used for qualified expenses or the money is non-refundable.
After all enrollment forms are received in the diocesan office, each church treasurer will receive a summary listing of their payroll for 2003. This letter will arrive early in January and will show the name of each person on the payroll, the gross salary to be paid, a "due per pay period" breakdown, and for laity only, the employer's share of social security tax.
This summary will serve as verification and billing for each period's payroll due to the diocesan office. No other notification will be sent.
13. HOURLY EMPLOYEE NOTIFICATION
Since each payroll period ends on a Sunday, hourly employee payroll information is due to the diocesan office no later than Monday at noon. This will allow the diocesan staff time to prepare payroll and transmit the data file to the bank on Wednesday. The best form of communication is e-mail but we are happy to communicate via phone whenever necessary.
Payment for payroll including hourly employees is
more difficult to manage. The most convenient and accurate way for it to be
handled is using the direct debit program where the Diocese of Maine debits your
checking account for the exact amount of your payroll at the same time that we
process direct deposits. Please give us a call to talk about the
"hourly" employee process if you would like to join the program and
have hourly employees.
Please feel free to contact me at ext. 30 -
lkaz@diomaine.org or Lou-Ann Milton at ext. 25 - lmilton@diomaine.org anytime if we can answer questions or help in any way.Again feel free to reproduce the enclosed forms as necessary.
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