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Taxes are something that most people pay however the question always comes up when it comes to the Amish and do the Amish pay taxes?
A lot of people think of the Amish as a community that is removed from society. In some regards this is true. They do have their own schools and other establishments that serve their community specifically. And they don’t have to worry about the future of money as much.
However, there are also certain aspects where there community does intersect with traditional US values. While the Amish do have a lot of religious beliefs and community rules that they live by, there are common intersections.
One of those intersections include Amish paying certain taxes. While the Amish do not pay all the taxes that regular U.S. citizens pay, there are some taxes that they are required to pay. Additionally, there are other taxes that the Amish do not pay such as Social Security taxes.
Below you will find the details of how the Amish pay taxes and which taxes the Amish pay.
Do the Amish Pay Taxes?
There is no question that taxes are important. Taxes cover the cost of many different things such as police, firefighters, and some hospitals. A lot of public schools are paid for by taxes as well. Other taxes cover the cost of the roads and expressways that you drive on.
People that work in government at the local state and federal level are paid by the taxes that people pay. Your local mayor or city manager is paid by the taxes that you pay to live in your community.
If you have parks in your neighborhood where you live, the maintenance and upkeep may also be paid for by taxes as well.
All of these items mentioned above function because people pay taxes. The Amish are one of the best examples of a community practicing frugal living and minimalism. Surprisingly, the Amish do pay taxes to the government even though they are a self-sufficient religious community. The Amish do have an exemption for paying certain taxes.
Do the Amish Pay Federal and State Taxes?
The Amish do pay federal and state income taxes. In addition they also pay sales tax for goods and services they have purchased. They also pay local county taxes as well. There are some specific federal and state taxes they would not pay such as the mandated gasoline tax. The Amish don’t travel in modern vehicles but rather by horse and buggy. As a result they do not purchase gasoline from traditional gas stations and don’t use gasoline much if at all in their community. If they are working under the table jobs or bartering for services in lieu of payment, they would not pay taxes on that.
The gasoline tax is usually charged and included with the price per gallon you pay at the gas station . However the Amish don’t purchase gasoline from gas stations so they would not be paying this particular gasoline tax. The pros and cons of hiring an accountant can help determine if you need one for your taxes.
Which Taxes Don’t the Amish Pay?
The Amish are a religious organization and community. As a result there are some taxes they are exempt from paying because of their religious status. The Amish do not pay Social Security taxes. The IRS recognizes their exemption status based on religion.
There are some very rare exceptions to this rule when Amish do have to pay Social Security taxes. This could occur if Amish businesses are employing workers that are not Amish or members of the community that have not been baptized into the Amish church. For the Amish businesses, they still need to know is a federal tax refund taxable?
However because the Amish do not pay into Social Security, they also don’t receive any of the benefits either. It is up to the Amish community to care for their own and for the elderly. They don’t believe in Social Security because they view it as a type of public insurance.
Social Security Exemption
In order for a religious group to be exempt from paying Social Security taxes they must meet certain requirements.
- Religious groups (such as the Amish) must be willing to waive their rights of benefits under the Social Security Act which also includes hospital insurance benefits.
- They must also be a member of a recognized religious sector and are against accepting benefits under a plan that makes payments in the event of death disability or retirement or also makes payments towards the cost of their medical care. This would be similar to the benefits that Medicare and Medicaid provide for people.
- They are a member of a religious sector that makes accommodations Anne provides food shelter and medical care for its members and has continuously provided these services since December 31st 1950 .
- They are a member that has never received or been entitled to any benefits payable under Social Security programs.
You can use IRS form 4029 to apply for an exemption from Social Security taxes.
Do Amish Have Social Security Numbers?
Although the Amish are exempt from the Social Security system, the Amish do have Social Security numbers when they join the church. The Social Security numbers are needed to file the exemption forms from Social Security. When the Amish have children they do not receive Social Security numbers as a baby, but rather once they are baptized in the church.
Do Amish Have Medicare and Medicaid?
The Amish do not have Medicare and Medicaid since they do not pay into the Social Security system and have an exemption. Amish view public insurance as a form of commercial insurance and do not believe in it. They take care of their own health and illnesses within the community.
Do the Amish Pay Taxes on Their Land?
The Amish do pay taxes on their land and do pay all required real estate taxes. In all actuality, the Amish pay quite a bit of taxes on their land because most live in rural areas. However, some Amish communities could be comprised of hundreds of acres of land for their farms.
The land is necessary because they provide a large majority of their food so they have to have livestock and also ample area to farm produce.
How Do the Amish Pay Their Taxes?
The Amish have to file income taxes just like you and I. There are a lot of ways to make $2,000 in a month for the Amish. Once they have made their income for the year, the Amish have to pay their taxes due.
There are Amish accounting services and businesses that help the Amish file their taxes. Most of the Amish pay their taxes through the use of a professional Amish CPA as they’re also a member of the church so they understand which taxes Amish pay in which ones they don’t.
Which States Do Amish Pay Taxes In?
If you are wondering which states Amish pay taxes in, a lot of that depends on where they live. The Amish originally settled in the Midwestern region of the United States. Since then they have expanded and they are located in areas with ample farmland. Farming is one of their main means of providing their communities with food along with raising livestock.
Additionally a lot of Amish have businesses that may also include non Amish workers . As a result they end up paying additional taxes.
The states their Amish pay taxes in depends a lot on where they live. The Amish pay taxes in multiple states.
Popular States That Amish Pay Taxes In
- West Virginia
The Amish today are in a majority of states in the country however they are more populated where they have access to land for farming.
How Much Do Amish Pay in Taxes?
It is true that the Amish pay the same taxes as U.S. citizens pay with the exception of the Social Security tax in certain situations. People often want to know how much is $40,000 per year per hour in the Amish community. The reality is that it is almost the same for Amish members as it is for US citizens with the exception of the social security exemption. Amish would earn roughly 7.65% more as an Amish employee or as an Amish Employer.
However, in addition to paying taxes to the US government, the Amish also have to contribute to their own community. Some make the argument that the Amish pay double the tax their non-Amish individuals pay. The reason for this is that the Amish also have to pay to fund their own schools for example in addition to paying taxes for public schools. Most of the Amish children attend private Amish schools which the US government does not pay for or fund.
Do the Amish Pay Taxes in Other Countries?
While the majority of Amish are found in the United states there are other countries where the Amish do pay taxes. Some of the other countries where Amish pay taxes include Canada, Bolivia, and Paraguay. There are also some newer colonies and communities in South America.
What About Mennonites? Do They Pay Taxes?
Mennonites do pay income taxes along with other taxes as well. The Mennonites must also pay real estate taxes, state sales taxes, state income taxes, and federal income taxes. Just like the Amish, the Mennonites are also exempt from paying Social Security taxes if they meet certain criteria.
How Do Amish Make Money?
There are a lot of ways that the Amish make money. Originally the Amish made money through farming and selling the produce in livestock at markets. In reality, they actually implore many creative ways to make money in their community.
Today the Amish make a lot of their money outside of the agricultural industry. One of the main ways that Amish make money today is through building furniture. The Amish are remarkable Craftsman and they build beautiful furniture. They also make money through skilled trades in manufacturing of certain parts they are usually sold to outside vendors or companies. The furniture that they build may oftentimes be sold to a local business that will sell the furniture.
For those Amish that have stuck with making money through agriculture, they have adapted a little bit. Nowadays a lot of the Amish that farm to make money focus on organic farming. They now produce things such as organic produce wholesome breads and products that are more natural and preservative free. For the Amish that adapt who follow organic farming , they know that people will buy their products.
Do Amish Use Banks?
There is a lot of misconception when it comes to the Amish finances and banks. While it is true that the Amish do not use technology for things such as instant mobile check deposits, they do have banking needs. A lot of people think that the Amish do not use banks but that is not the case. The Amish do use banks and have regular savings and checking accounts. The main reason Amish use banks however is for loans four things such as horse and buggies or their houses. The Amish have excellent fiscal discipline and oftentimes they will pay off their mortgages early so they can own their homes free and clear.
Do Amish Get Stimulus Checks?
Amish have been receiving the stimulus checks. Due to their religious beliefs and non-reliance on the federal government for assistance, the Amish have not been accepting the stimulus payments. They Amish see the stimulus checks as a form of social welfare, and are planning to return all stimulus checks received back to the Federal Government.
Do the Amish Believe in Filing for Bankruptcy?
While the Amish are excellent stewards of finances, there are some Amish that sometimes will struggle with debt. The Amish do not believe in filing for bankruptcy rather the Amish community will help that member who is having financial difficulty. They will also assist that member if they are having trouble with budgeting and managing their money. Oftentimes the Amish community will offer resources and tools to help the struggling member.
Some tools that they might use to assist Amish members who are struggling with their finances is to set them up with a basic checking account. This would include starter checks and teaching that member how to write a check. An elder of the Amish community may take the struggling member and show them basic financial lessons including how to void a check as well.
Do Amish Vote?
The Amish do vote sometimes in presidential elections and are considered part of the conservative movement. The Amish beliefs focus on the fundamentals the align with the conservative party. While the numbers of Amish voters are not overly significant, it was enough to help President Donald Trump closed the election gap during his election especially in Pennsylvania.
Summary of Amish Taxes
There are many different Amish beliefs when it comes to paying taxes. Amish must adhere to the Amish rules once they are old enough to join the church. There are Amish rules when it comes to paying taxes. The Amish do pay taxes with the exception of Social Security due to their exemption and net more in income than a US citizen who has to pay Social Security tax. However, Amish often pay double the tax on some things such as schools for example.