Reporting Changes to Us
How do I report employment changes?
You can report any changes for employees who are existing members of any of our plans by calling a senior benefits specialist at 800.986.6222. You can also email billing@mmbb.org – or fax us (to the attention of “Billing”) at 800.986.6782. Written correspondence can be addressed to:
MMBB
475 Riverside Drive, Suite 1700
New York, New York 10115
Reporting Changes to MMBB FAQ
Employment Changes
Q: What happens when a minister ends employment with a church?A: When a minister’s employment ends, notify MMBB immediately. You are responsible for paying BFL premiums for the full month, even if the minister’s employment ends during the month. Notify MMBB of the last month for which you, the employer, will pay the premium for the minister terminating employment. Please provide MMBB with the name and address of the minister’s new employer if you know it.
Q: What information does MMBB need when you employ a minister who is already a premium-paying member of Benefits for Life?
A: MMBB needs:
- Name, address and telephone number of the employee and new employer
- Month that you, as the new employer, will start paying premiums
- Minister’s compensation for determining the premium
- Cash salary
- Rental value of parsonage, utilities allowance and parsonage allowance or housing allowance
- Social Security/Medicare tax offset, indicating if it is to be included for determining the premium
A: Because the minister’s previous church probably paid the current month’s premium in full, your church will not be billed until the next month. MMBB should be notified of your new minister’s name, home address, starting date of employment and compensation as described above.
Q: Our pastor is retiring. When should we notify MMBB?
A: Notify MMBB at least 90 days before the intended date of retirement. Send in final premium payments no later than the 15th of the month before the pastor’s retirement date to ensure that they are included in the annuity.
Q: How do we report other kinds of changes—such as address changes—to MMBB?
A: If you have any questions regarding address changes, premium invoices, compensation changes, billing or employment changes for any of MMBB’s plans, call us at 800.986.6222 or send an email to service@mmbb.org.
Compensation Changes for BFL
MMBB requires certain information before a member’s compensation can be changed on the MMBB system. We recommend making compensation changes with MMBB’s Compensation Change Request (Form A-18). Please read the form carefully before completing it. Incomplete forms will delay the processing of your request.
Q: How can you report a compensation change to MMBB?A: Notify MMBB in New York (do not send changes to the Dallas address with premium payments). Changes received by the 15th of each month generally appear on the following month’s invoice. For example, if MMBB receives a compensation increase by January 15th, the February invoice will reflect the change. Report any compensation change to MMBB as soon as the change is approved. Compensation changes affect death and disability benefits as well as retirement accounts. Retroactive changes are more difficult to make.
Q: What happens when compensation changes are not reported?
A: Since a member’s retirement income, disability and death benefits are based on the compen- sation reported, failure to report changes could result in lower benefits.
Q: Can our church make up for compensation that has been underreported to MMBB?
A: Yes, as long as the amount of those additional premiums falls within IRS limits and your church provides documentation of the member’s actual compensation for those years. Contact MMBB for information and a calculation of contribution limits for the member. MMBB will invest additional premium payment amounts entirely in the member’s Retirement Plan account.
Q: Will additional premium billing to make up for underreported compensation or delayed enrollment appear on the monthly invoice?
A: No. Send these payments to MMBB separately.
Q: Where should you send the additional premium payments?
A: Send these payments to MMBB in New York with a letter indicating the purpose of the payment.
Q: Do we need to include all components of a minister’s compensation whenever a new compensation amount is reported to MMBB?
A: Yes, it is best to report all components of a minister’s compensation—especially amounts for housing and a Social Security/Medicare tax offset—whenever a new compensation amount is reported to MMBB.
Q: If the employee’s compensation changes, will that affect the amount he or she can contribute to TAS?
A: A compensation change may make a difference in the amount the IRS allows a member to contribute to TAS, especially if the TAS contribution is expressed as a percentage of compensation. When a compensation change occurs, you should request a new TAS calculation from MMBB.
Contribution Changes for TDA
Q: How should we report changes in TDA billing?A: Call MMBB, toll free, at 800.986.6222.
Q: Is it important to report a change in compensation for someone with a TDA account?
A: Yes. The amount of a member’s compensation will make a difference in how much can be contributed to any 403(b) account the member has. Be sure to report compensation changes to MMBB promptly for all plan members.
Contribution Changes for TAS
Q: How can employees change their TAS contributions?A: Your employee can make up to four TAS changes per year, up to once per quarter, unless she or he changes employers. The first step in changing the amount of the TAS contribution is to submit a new salary reduction agreement to MMBB. The change in the TAS contribution takes place after MMBB receives the completed salary reduction agreement. Under IRS rules you, as the employer, cannot make the salary reduction retroactively.
If you have a new employee with an existing TAS account, she or he only needs to submit a new salary reduction agreement in order to resume contributing to TAS—provided that your church has the required resolution and TAS Adoption Agreement on record. If the employee already has a TAS account, no application form is required.
Q: How much can an employee contribute to TAS?
A: The IRS limits how much money an employee can put into TAS on a pre-tax basis. The amount an employee can contribute to TAS depends on salary and other variables. Encourage your employees to call MMBB to request a calculation of the maximum allowable contribution.
Q: If an employee completes a salary reduction agreement to contribute a percentage of compensation to TAS, rather than a specific dollar amount, what happens when compensation changes are reported to MMBB for the employee?
A: MMBB’s billing for TAS contributions for that employee will change according to the percentage. For example, an employee’s salary reduction agreement states that his or her compensation will be reduced by 5% for TAS contributions. The following year the employee receives a $2,400 compensation increase. The invoice will have a $12 monthly increase in the employee’s TAS contribution, which should be withheld from the employee’s pay.
Q: Are pre-tax TAS contributions reported as taxable income when paid to MMBB?
A: Pre-tax TAS contributions are not included as income when calculating federal income taxes and self-employment taxes (Social Security/Medicare taxes) for clergy. For lay members, TAS contributions are not reported as taxable income for federal income tax purposes but are included for determining Social Security/Medicare taxes. TAS contributions are not reported as taxable income in most states.
Q: How long is a salary reduction agreement in effect?
A: The agreement continues until:
- MMBB is notified to terminate the agreement (you cannot terminate the agreement without the member’s consent).
- There is a change in employment.
- There is a new salary reduction agreement.
- The amount of TAS contributions exceeds the IRS limit.
- A hardship distribution is made from the TAS account.
A: The employee should submit a letter to the employer requesting termination of his or her salary reduction for TAS contributions with an effective date for the change. You, the employer, then convey that information to MMBB requesting the change in billing.
Q: When should your church and your employee complete a salary reduction agreement in order to have the employee’s desired amount withheld from his or her pay for pre-tax contributions to TAS?
A: Complete the salary reduction agreement in the month before the pay period for which the employee would like to have the money withheld.
Example: Your payroll period is every two weeks. The member wants to have money withheld for TAS contributions from the February 5–19 pay period. In order for the withholding to be treated as a pre-tax TAS contribution, the salary reduction agreement must be signed by both employer and employee no later than January 31 and, of course, MMBB must receive a copy in time to adjust the invoice.
Q: Can a salary reduction agreement apply to amounts withheld from pay before the agreement is signed?
A: No. The amount invested in TAS is only considered a pre-tax contribution if it is made after the date a salary reduction agreement was signed by your employee and you, as the employer. If amounts are withheld before the completion of the salary reduction agreement, MMBB will notify you, as the employer, and your employee that the amount will only be accepted if treated as after-tax contributions and allowed within the maximum annual contribution. Such contributions should also be included as taxable income on the employee’s IRS Form 1040.
Example: An employee decides to make TAS contributions. The employee signs the salary reduction agreement on February 25 and the employer signs it on March 12. Only money for wages earned after March 12 can be accepted by MMBB as pre-tax contributions. Any money withheld prior to March 12 will be treated as after-tax contributions by MMBB.
Q: Can an employee continue TAS contributions after a TAS distribution from his or her account based on IRS hardship tests and conditions?
A: No. Under IRS rules, a member who took a TAS distribution based on IRS hardship tests and conditions cannot make TAS contributions for the next six months.
Q: Does an employer need to execute a new salary reduction agreement for the employee to resume TAS contributions after the six months?
A: No. MMBB’s billing for TAS will cease during that time and will resume for the same amount beginning the seventh month, unless MMBB is notified to stop billing for the TAS contribu- tions for that employee. You must stop withholding TAS contributions for the employee in question for a period of six months after the employee has taken a TAS distribution based on IRS hardship tests and conditions. If your employee wants to change the amount of TAS contributions following the six-month suspension, your church and the employee must execute a new salary reduction agreement.
From the 2012 MMBB Guide for Church-Related Employers. For the full guide, please visit our Download Documents & Resources section.