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Civil Law Considerations—Financial Law | D-1
Please note that information provided in this chapter
does not constitute legal advice. Dioceses, eparchies,
seminaries, institutes of consecrated life, and societies
of apostolic life should consult with legal counsel before
developing local policies or applying information con-
tained herein to individual cases. Detailed and updated
versions of the civil law considerations chapters may be
found at:
www.usccb.org/about/general-counsel/guidelines-for-receiving-pastoral-ministers-in-
the-united-states.cfm.
Introduction
In addition to the requirements of immigration
law, local policies regarding international religious
workers and seminarians need to incorporate the
many legal implications of financial issues that
these workers and their ecclesiastical sponsors must
address. This chapter of the
Guidelines
will identify
key issues for consideration in policy development.
Primary emphasis will fall on R visa holders. The
issues to be examined include: basic concepts of
financial responsibility and organizational struc-
ture; general federal income tax and social security
tax principles; federal tax-exempt status; the basic
operation of the USCCB group tax-exemption rul-
ing; restrictions on fund raising within the United
States; and discrete aspects of these issues as they
apply specifically to clerics, non-ordained members
of religious orders, and seminarians. In addition to
federal income tax and withholding obligations, a
religious worker may also be subject to tax and with-
holding at the state and, less frequently, local level.
State and local tax liabilities are beyond the scope
of the
Guidelines
.
Terminology
Unless a more limited reference is specified, the
term “international religious workers” or “reli-
gious workers” is intended to refer to individuals
born outside the United States who are clerics,
non-ordained religious, and seminarians.
1
The term
1 Although non-religious lay workers are not the focus of the
Guidelines
, they receive minor mention in order to properly address
the tax treatment of certain other religious workers.
“church employer” includes, but is not limited to,
a diocese or eparchy, parish or parish school, and
religious order
2
as well as any related charitable or
other organization exempt from federal income tax
under section 501(c)(3) of the Internal Revenue
Code (Code) and listed in the Official Catholic
Directory (OCD).
Organizations Authorized
to Sponsor International
Religious Workers
Among the organizations eligible to sponsor indi-
viduals for R visa status are bona fide organizations
affiliated with a religious denomination and exempt
from taxation under section 501(c)(3) of the Code.
To ensure that only qualified organizations sponsor R
visa religious workers and that there is proper coor-
dination of the movements and ministries of inter-
national religious workers within the United States,
it is recommended that eligible sponsoring organiza-
tions be limited to section 501(c)(3) organizations
affiliated with the Catholic Church in the United
States
at the level of a US diocese or eparchy or a US
province of a religious order.
At a minimum, diocesan
or eparchial policies should require that parishes,
schools, and related church employers coordinate
with the diocese or eparchy prior to sponsoring any
international religious worker.
Responsibilities of
Church Employers
R visa religious workers are expected to be employed
by sponsoring organizations or other church employ-
ers as detailed in their visa petitions. The employing
organization is responsible for properly classifying
workers as employees or independent contractors.
The employing organization is also responsible for
reporting religious workers’ compensation to the fed-
eral (IRS), state, and local tax authorities, as required
2 As used in this section, the term “religious order” means a canonical
religious institute or society of apostolic life that meets the require-
ments of Rev. Proc. 91-20, 1991-1 C.B. 524.
Civil Law Considerations—
Financial Law