Finance Staffing Costs

Posted on June 14, 2012 Written by

Every organization spends money on staff who will do the financial accounting for it. These are skilled individuals with a passion for their organization. Frankly, they’re not working there for the money; these people are talented enough that they could get better-paying positions at for-profit companies. But that’s not where their heart is. They want to make a difference in the world, so they work for churches and non-profits.

My experience and knowledge says that there is a formula that can be applied to determine what an organization should pay for its finance staff. This formula is for the staffing functions only; there are additional costs for materials, computers, training, etc.

Here’s the formula: 3% to no more than 4%

That’s it. That simple.

Here’s what I mean by that. Figure out what your gross receipts are for the past year. By gross receipts, I mean all revenues from all streams that came into the organization for the past fiscal year. Take 3% of that figure and you should be able to staff your finance department with that budget figure.

For instance, if your operating budget plus additional gifts totals $600,000, then should expect to pay about $12,000 for someone to manage the entire financial office: contributions, accounts payable, payroll, general ledger (which includes bank reconciliation), and financial reporting. At the most, you should pay $15,000 (which is 2.5%).

If you are paying substantially more than that, I think you’re paying too much (remember, this is my opinion) unless your finances are incredibly complicated (and if they are that complicated, then you need to find ways to simplify them). Check out your financial operations, see how efficient and effective they are, see if they have the right tools to make them work faster and better, and then decide if you are paying too much because you don’t have the right staff. Then, get the right staff people!

Lead On!
Steve

Filed Under: accounting, budget, church finances, church staff Tagged: , , ,

Bell Curves and Giving

Posted on May 24, 2012 Written by

Here’s an interesting stat: the most generous age bracket in any church are 50-somethings.

  • College for the kids is done and paid for
  • The kids’ weddings are over
  • The mortgage is low because they got it several decades ago (if they even have a first mortgage)
  • They are in middle to upper management at work making really good money
  • In short, their expenses are low and their income is high which means they’ve got more disposable income than other age brackets.

What about the other decade age brackets regarding their charitable gifts? Here’s my analysis of them:

  • 20-somethings are just getting started financially. Many have serious college debt, most are not ready to settle down with a spouse (much less kids), and their income is on the low side since they are just beginning their careers.
  • 30-somethings have begun to settle down with families and careers but they are financially strapped because of the mortgage, cars, retirement planning, new furniture for the home and kids, etc. They’ll give, but it will be usually from their financial leftovers. A few are giving more and more but they are the exceptions.
  • 40-somethings are well into their careers and an impressive number have even risen to upper management already. Many have figured out a financial strategy and are able to give surprising amounts. Others want to give but can’t, right now.
  • 50-somethings are the main givers to every church. Not every 50-something is a big giver but the preponderance of them give more than at any other time in their lives. They’ve reached the age when they want to live for significance, not success.
  • 60-somethings have retirement looming over them and their giving begins to decrease, sometimes rather sharply. Some 60-somethings have to keep working while others are planning comfortable retirements. However, in every case, they are beginning to ask the question that 70-somethings ask every day.
  • 70-somethings wonder “Am I going to outlive my money?” and that causes their charitable giving to drop off a cliff. Those with ample resources continue to give, but the ones with “just enough” cut their giving back significantly.
  • 80-somethings and beyond do not form a large giving base for two reasons: their numbers are smaller than other age brackets (and shrinking daily) and their financial resources are smaller than the other age brackets. An occasional 80-something will be a high-capacity giver, but most are hanging on by their financial fingernails.

How does this translate to a church?

  • At either end are the 20-somethings and 80-somethings: the goal is for the 20-somethings to be giving, per person, more than the 80-somethings. “More” is probably about 1.5 times.
  • Next are the 30-somethings and 70-somethings. In a healthy-giving church, the 30-somethings will be giving about twice what the average 70-something is giving, because giving by 70-somethings is plummeting.
  • The 40-somethings should be the second strongest age bracket in a church, and the third strongest should be 60-somethings. 40-somethings are the “left shoulder” of the bell curve and 60-somethings are the “right shoulder.” Strengthen that right shoulder as much as you can because in 10 years, they’ll be 50-somethings.
  • The peak of the bell curve is the 50-something crowd. Who are your 50-somethings today? Who coached them to give? What was their giving like 10 and even 20 years ago?  But wait, look at your church 10 and even 20 from now. Is estimated future giving by your current 30- and 40-somethings enough to replace what your current 50-somethings are doing? What are you doing long term to ensure that generosity becomes part of your church’s culture?

A church must be cultivating and encouraging generous giving with the 40- and 50-somethings. That should be the church’s main focus. Next should be the 30- and 60-somethings. Lastly, the 20-, 70- and 80-somethings should get the least financial emphasis focus, because they are in the weakest position to contribute to a church. By “cultivating and encouraging generous giving,” I mean that there should be a stewardship education plan for all groups but that those age brackets should get a bigger dose than other age brackets. Give them a second helping of generosity teaching; it will do them and you some good.

By the way, this analysis is true of annual giving (giving from your checkbook or income statement) but also of planned giving (giving from your estate or balance sheet). A church should encourage 40- and 50-somethings to put the church in their will. The 60-something and older crowd have typically already created a will (although the percentage of people without wills is shockingly high). Get some estate planning for 40-somethings and 50-somethings ASAP!

Lead On!
Steve

Filed Under: church finances, leadership, wisdom, young adults Tagged: , , ,

Strategic Budgeting for a Young Marrieds’ Ministry

Posted on May 18, 2012 Written by

One of my former churches has a strategic vision for reaching young and median married adults. They don’t ignore senior adults, but they put a vast amount of resources to targeting 20-, 30-, and 40-somethings (and that overlaps a little to the 50-somethings). Since I was on staff there, let me give you their “secret” plan. Actually, I don’t think it was strategically thought out except that God led them to develop a very good plan. The plan is actually buried in the detail of the budget which most people don’t see, but they do see the results. Serious financial resources (staffing, buildings, and programming) are expended – the results are that this church is known as the church for young married in that city.

  1. Nearly/Newly married couples (20-somethings)
    1. The church wants to get in front of engaged couples or even couples who are going to be engaged. Female staff members informed the male staff members that future brides spend a lot of time reading local wedding magazines. So, the church now hosts bridal shows, advertises in wedding magazines, reaches out to local wedding photographers and caterers, etc. They want to be known in their local wedding industry as a wedding-friendly church.
    2. The church has two small group or Sunday School classes for nearly/newly married couples. The teachers for these classes are couples who’ve been married for over 20 years who can provide good role-models. The female teacher regularly meets with the young women in the class and the same for the guys. This provides outlets for the genders to share what is going on with them as they go through life.
    3. The church also supports this age group with seminars by bringing in speakers and/or sending them to a conference at another church. Also, about two times a year there are fellowship meals  at the church (with childcare provided if needed). The goal of these times together is for nearly and newly marrieds to get to know each other and eventually to become the support network for each other as they go through the various life-stages together.
  2. Families with young children (20- and 30-somethings)
    1. When a couple announces they are pregnant, the staff assign another young married couple to partner with the pregnant couple. The assigned couple helps the pregnant couple in any way possible such as accompanying the woman to the doctor if the husband is away, providing childcare for other children while mom is at the doc, having at least one supper together during the pregnancy, and even organizing a baby shower especially if this is the first child.
    2. After the baby is born, the assigned couple coordinates getting food to the new parents, informing the church staff of the new baby, and getting a sign from the church which they place in the front yard of the couple so that their neighbors will know about the new arrival.
    3. The church has a bulletin board with 12 sections (one for each month) and pregnancies are made public by placing the couple’s name on the bulletin board in the month that the baby is due. When the gender of the baby is known, a small blue or pink ribbon is pinned by the parent’s name.
    4. At least once a year, the church hosts a nice supper for everyone that had a new child born in the past year. Childcare is provided and the parents get to enjoy a quiet dinner (maybe their first as a couple since the baby came) with a bunch of friends who are in the same life-stage as them.
    5. There are no “mass baby dedications” – only one baby is dedicated per worship service. The family is invited onto the platform, the pastor holds the baby, says a few nice words, has a prayer of dedication for the baby, parents and any siblings. BTW, the baby is kept in the nursery until the dedication time – then a volunteer brings the new baby from the nursery, hands the baby to the mom just before the parents go forward and after the dedication, the volunteer takes the baby back to the nursery so the parents can stay for worship.
    6. Each month there is a PNO (Parents Night Out) and a SNO (Social Night Out). PNO is meant for couples to drop their kids off at the church so mom and dad can have a date. SNO is for classes or small groups to have fellowship time together while kids are safely in a church nursery. The cost for three hours of childcare is minimal, about $7 or $8 per child in order to make this affordable for parents – yes, the church budgets money to subsidize this but not much since there is so much volume that a fair amount of income is provided by the parents.
    7. The children’s division had a priority for funding in the annual budget. If necessary, the pastor would solicit children’s workers and also encourage them. Teaching the teachers was emphasized by bringing in education specialists from nearby colleges.
    8. Facilities improvement was constant. A list of needs was kept current and as items on the list were ticked off, other items would be added. The goals was to keep the facilities in very good condition because new parents want and expect the best for their children.
    9. Over the summer, there were day camps at the church for preschoolers (“popcicles and pools”), weeklong summer-day camps centered on recreation at a nearby campground. These kept the children busy and provided opportunities for the parents to talk and support each other.
    10. The goals are for the church to be a place children WANT to go to and a place where young parents are finding the support and training network for this brand-new stage of their lives.
  3. Marriage enrichment (30-, 40-, and 50-somethings)
    1. The church provides bi-annual marriage conferences with a very good outside speaker. The conference is often a two or three day event where the speaker is on several times speaking in formal settings (such as Sunday morning sermon time) and informal settings (such as a dinner with a Q&A time). The topic of the conference is about making marriages work and improving communication between spouses.
    2. There are other seminars on personal finances which is critical to new marriages. The church provides training for small group teachers regularly; it continually improves the facilities, and even has on-campus counselors (a local Christian counseling org uses church space rent-free but gives church members a discount).
    3. The goal is for the church to support couples during all the difficulties of marriages. Couples who’ve been married 10 to 30 years go through massive life-style changes and adapting to them requires constant re-focusing by both spouses. The church wants to help each partner understand his/her role in the new patterns and understand what the other parent is going through. Yes, there are divorces at this church, but fewer than I’d seen at other churches.

Okay, this is how one church (albeit with a lot of resources) does it. And I never said what this church does for children of these young marrieds. Frankly, the children get about the same as children in other churches but the difference is how much attention the parents are given in the church’s budget and programming.

How are you living out the key components of your strategic plan and vision?

Lead On!
Steve

Filed Under: budget, church finances, young adults Tagged: , ,

Tellers

Posted on March 26, 2012 Written by

Most congregations have some form of tellers that count the Sunday offerings. There are no regular patterns:

  • some count on Monday, some on Sunday
  • some count during the service, some count after worship
  • some copy checks, some write down all the info
  • some enter data into the database system, some fill out forms and leave the docs for the finance office
  • some take an hour, some take almost an entire day to count
  • some teller teams have been disbanded leaving the job for the finance office staff and some teller teams will never give up their prize job

The purpose in having a Teller Team is to ensure that all funds are counted and deposited. It is a carry forward from days when the church didn’t have a staff to count the money – volunteers took turns counting the Sunday collection and depositing the money. In many, if not most, churches, those days are long past but the committee lives on and on and on and on. Most tellers will tell you they feel they are protecting the church by ensuring that no one steals the money. Funny story – I worked at a church where the extremely zealous Teller Team never wanted the church staff to touch the money and they cited a story from 50 years ago when money was stolen – but it was stolen by a member of the Teller Team!

Let me suggest the easiest way possible for both the Teller Committee and for the Finance Office staff. This will save time, improve accuracy, cut down on gossip, and make everyone happy – yes, it sounds too good to be true!

  1. Once the tellers have the offering, they should spread it out on a table
  2. The tellers should go through the pile and gather all loose dollars and coins
  3. All loose plate cash should be added and written on the deposit slip on one detail line
  4. Then the tellers should stack and open all envelopes (but not pull out the contents)
  5. Envelopes with checks should be placed in one stack and envelopes with cash in a separate pile (envelopes with both, which is rare, should be in the cash pile first and then moved to the check pile after the cash has been removed and noted on the envelope)
  6. Cash in the envelopes should be removed and the amounts written on each envelope
  7. All envelope cash should be added and written on the deposit slip (same one as #3) on a detail line
  8. Then total all the cash and coins and write them on their respective lines at the top of the deposit slip. Two members of the teller team should initial the deposit slip so that an alternate slip is not made.
  9. You now have one deposit slip and all cash (currency and coins) for the bank
  10. A member of the teller team can take the cash deposit to the bank or leave it for the staff to deposit
  11. Next, rubber band all the cash envelopes together and another stack of the check envelopes
  12. Take the stacks of envelopes to the finance office in a locking bank bag
  13. The tellers have now finished their job and can leave.
    1. Because the tellers do not see the amounts on the checks, they do not see what various people give. All too often I’ve seen tellers discuss a gift by Mrs. Smith and that this week’s check is bigger/smaller than last weeks and then wonder aloud what that means about her. Confidentiality is paramount in dealing with church money and if you have gossipy tellers, you’ve got a problem. Removing the temptation by removing the checks solves that problem!
  14. The financial assistant will then scan the checks (if you don’t have a check scanner, you’ve gotta get one – they’re not terribly expensive but they are incredible timesavers!).
    1. In every church I’ve seen, the financial assistant and a scanner are 10 times faster and more accurate than the tellers. All too often tellers make a (very human) mistake which means their total is not equal to the finance office total and that make the assistant have to search for the error – time she/he could use on something else.
  15. When the financial assistant scans the checks, she/he can also scan the envelopes and the software will record an image of both check and envelope should you ever need to refer to them again (that happens more often than you think)
  16. After scanning, the assistant gets a report from the software and prepares a deposit slip for the checks (the cash is on a separate deposit – see #8-10).
  17. Ideally, someone other than the financial assistant will take the deposit to the bank to prevent embezzlement.
  18. The offering/deposit totals are then recorded in the General Ledger of the church’s financial journal.
  19. The finance office now has a record from the computer of the Sunday offerings and that paper record is rubber banded with the deposit slips and kept for seven years (that’s what a record retention schedule recommends). If you have scanned the offering envelopes, then shred them; if not, keep them with the deposit slips.
  20. The financial assistant can now move on to the next project, probably payroll or accounts payable.

These steps are pretty easy to do. The tellers can do their job in about an hour. The financial assisant can do her/his job in about an hour IF there is a scanner (again, get one!). In two hours (maybe 3 for a big offering), all the church receipts can be totalled, prepared for deposit, and entered on the church’s database. That will save loads of time that can be used elsewhere.

The tellers will need some equipment such as:

  • A room where the tellers can lock themselves inside to preclude anyone from randomly walking in. Safety and security are paramount.
  • The room should have tables so the offering can be spread out
  • The offerings should ALWAYS be in the possession of two unrelated people. No husband-wife only teller teams or any other familial combinations; if a husband and wife are present, then a third completely unrelated person MUST be present.
  • Locking bank bags are good. If the tellers count right after or during the service, then the offerings should be placed in the bank bag after counting and the bags locked tight.
  • If the tellers finish on Sunday, then the bank bags should be placed in a safe; if the tellers won’t count till Monday, then the bank bags should be placed in a safe on Sunday morning. Then, on Monday morning, two people should go to the safe to retrieve the money.
    • To prevent people from stealing money while it it in the safe, purchase a safe that has two combinations and then give the two combinations to separate, unrelated people. Those two people will always have to be present to unlock the safe. (An envelope containing both combinations can be sealed and stored offsite with a church trustee or a bank official.)
  • Since the tellers are only counting cash and coins, not checks, they shouldn’t need any adding machines. Even if you got $1,000 in cash, two different people can add that up in their head or writing down figures. Save some money and storage space – don’t buy the machines.

Some churches have completely disbanded the tellers and that is fine SO LONG AS you have enough internal controls to prevent one person from handling all the money by him/herself, especially the cash. Checks are not easily stolen (they can be but it is really hard) but cash is easy to pocket. Take adequate measures to protect the staff and tellers, but make the work as easy as possible.

Lead On!
Steve

Filed Under: church administration, church finances Tagged: ,

1Q2012 Statement of Contribution

Posted on March 22, 2012 Written by

One quarter of 2012 is almost over so you need to prepare now to send out your first quarterly contribution statement of the year. Some churches send out statements only once a year – let me encourage you to send out statements each quarter plus one more:

  • 1Q2012 – send out in the first 10 days of April
  • 2Q2012 – send out in the first 10 days of July
  • 3Q2012 – send out in the first 10 days of October
  • 4Q2012 – send out the yearly statement by January 31

PLUS

  • Send out a statement for the first eleven months (January through November) in the first 10 days of December. Why? So that people can see what they’ve given or not given so far in the year.

But let’s get back to 1Q2012!

Sending a statement out in early April makes sense for several reasons:

  • Use this opportunity to send a letter with the statement of contributions explaining to people what their money has been used for. They want to know what the church did with it – so tell them all the good things you’ve been doing and are planning to do. Share with them a couple of compelling stories – that will make all the difference in the world to some readers.
  • At this time of year (tax-filing season in the US), people’s awareness of how much they’ve given or not (and thus able to deduct from their tax return) is heightened. Since many people have just completed their annual tax forms, they’re making promises to themselves to give more away to charity so they can give less to the government. Sending a letter in early April gives them a great reminder to give a check to their church.
  • Easter is typically in early April. Most Christians will come to church on Easter and they’ll usually hear a sermon about God’s gift to us through Christ. They will hear about giving and sacrifice – this letter is a way to encourage them to tangibly respond with their own gifts.
  • Gentle reminders throughout the year of how much people give to their church are good for both the church and the donor. These reminders are not heavy-hitting or guilt-inducing. These letters are simply nudges in reminding people to be financially faithful to their church – and you’re sending these letters to the people who have already “bought in” to the vision of the church, they’re already giving!

So, here’s your homework for this weekend: find two great stories about what has happened in your church these past three months (since Christmas), put them in a letter, and send the letter with the quarterly statement of contributions.

Oh, one very important fact: send your letters with first class postage. Yes, that is a lot more expensive than bulk mail. But realize that the “open rate” (as opposed the “throw in the trash can rate”) of first class stamped envelopes to bulk mail envelopes is something like five to one (don’t quote me on that ratio, but it is way up there). People will open an envelope with first class postage far more often – and you want people to open envelopes to read the letter and the statement of contributions. Okay, back to your homework.

Lead On!
Steve

Filed Under: budget, church finances, church financial statements, communications Tagged: , , ,

Two Cool Solutions

Posted on February 24, 2012 Written by

[guestpost]This blog was written by my wonderful wife, Jennifer, and I asked if I could post it under her byline. These two products, DropBox and CrashPlan, are cool apps for church IT. Check them out.[/guestpost]

I’m no expert on IT issues, but I’ve done some independent research lately on electronic file backup and storage options for homes and small businesses. It seems to me that these solutions might also be helpful to churches. There are a number of options out there, and many bloggers and tech review sites offer opinions/reviews. When I research things online, I prefer to consider a combination of review types because I like to look for consistencies among them. Bloggers tend to be individuals who offer advice based on personal experience; tech sites usually offer composite reviews either from other users’ experiences or from their own tests. I’m careful not to pay attention to those sites that are sponsored by software companies or related online services, as they likely present biased opinions depending upon their sponsors.

That said, I’ve discovered there are two really amazing online services offering extremely affordable solutions for storage and file sharing (I say they’re amazing because to some degree they are free, and they offer a lot of helpful features even at no cost to the user). The two I find most interesting and promising are Dropbox and CrashPlan. At first, I thought I’d want to choose between one or the other; what I discovered, though, is that they are two different animals.

This isn’t a tech blog, so I won’t list specific plans and options. You can check those out by doing an online search of your own (try entering “CrashPlan vs. Dropbox” or some similar text, and you’ll find all that). Dropbox is a free, online service that allows you to store up to 2GB of files in their cloud (you can purchase more space if you need it) and access those files from any of your devices–and it syncs them automatically in real time. You can also share folders with other Dropbox users–a huge plus for people working on a project together. I use Dropbox on my iPad, iPhone, iMac, and PC laptop. There’s an Android app for it too, and all their software and apps are free. Because I work both from home and an office, I am able to keep folders with all my work files in Dropbox and work on them no matter where I am, and they sync automatically to all my devices. I use Word and Excel files almost exclusively, though I do put some some photo files there, and after about a year I’m still using only 3% of my available free space. If you use multiple devices for your work and haven’t tried Dropbox, you simply must take a look at it. It also allows you to access your files using your password via their website, and you can do that from any computer when you’re online at any location.

CrashPlan is an efficient and inexpensive way to back up all the files on your computer. They offer a free plan that allows you to back up from one computer to another (if you want to back up, say, from your home to your office computer), but if you want to use their online (off-site) storage cloud, you have to subscribe. Their top plan for users who have up to 10 computers–with unlimited file storage–is only $72 per year. You can set the backups to occur as often as you want (they recommend nightly, but you can do it more often if you choose). CrashPlan is more secure than Dropbox, as everything is encrypted.

Many reviewers recommend using both of these services together. The one caution is about Dropbox and its security; if you are dealing with highly sensitive, confidential information, you probably won’t want those files on Dropbox. Even though they are accessible only to your devices on which you’ve loaded the software, anyone who uses your devices can access them. I plan to check out CrashPlan’s free trial soon and potentially use it to back up all my computers. With these great options available, I seriously wonder about the need for organizations to maintain local servers and whether we’ll see a change in that practice in the future. But as I said, I’m not an IT expert. I just enjoy finding and using new options in technology that make my work more efficient, secure, and simple.

Lead On!
Steve

Filed Under: church finances, strategy Tagged: ,

New Year’s Letter

Posted on January 1, 2012 Written by

I’ve got a job for the leader of your faith community: write a letter to your congregation about your dreams for 2012. Technically it is not a “New Year’s Resolution” letter but it is a letter about your hopes and vision for the church for the new year. Call it a “New Year Vision Letter.”

What should be in this letter? Well, it should be no more than one page – please don’t get long-winded or else people will stop reading after about two paragraphs (if you’re lucky). Use a 12 point font to make the letter easier to read – don’t cheat by using 8 point font to cram in more words! Make the letter no more than five paragraphs long using the following template:

  1. Intro Paragraph – Write about 2011 and where the congregation has come in the past 12 months and even the years before then. Be brief, be very brief in this synopsis – this is NOT the purpose of your letter; this is just a starting point so that everyone is on the same page.
  2. Next Two or Three Paragraphs – give three concrete (lots of details) ideas of what you want to accomplish in 2012. Flesh out each idea in one paragraph with financial costs, numbers of volunteers needed, dates by which the goals need to be met, and the promise of a party when each goal is reached. (I believe the church doesn’t party enough – we need to celebrate accomplishments more often but that requires knowing where the finish line is in each goal.)
  3. Final Paragraph – a prayer of blessing on each reader and an acknowledgement of the generosity by the family of faith which has permitted the church to do all is has done so far. Being sincerely thankful is very important.

This letter should go out to every person in the church because it will help set the tone for the church in 2012. A good way to send out the letter is to include it in the 2011 statement of contributions which every church mails out to every member (at least to every donor) of the church. Every person will open that letter because they want to see how much they can write off on their taxes – when a letter from the pastor falls out, they’ll read that, too. Who knows, your letter may spark some dialogue with people – it can certainly be a conversation starter with your leadership. I know they want to know what your dreams are and how they can participate in making them happen – to benefit the church and the Kingdom.

Lead On!
Steve

Filed Under: church administration, church finances, church financial statements, communications, leadership, strategy Tagged: , , , , ,

IRS Tax-Exempt Ruling Letter

Posted on November 29, 2011 Written by

Whether or not a church should obtain its own 501(c)(3)ruling letter from the Internal Revenue Service (IRS) is a question with some confusion. It is a simple question with a multi-layered answer so here is my take on this issue.

  1. The IRS considers, by definition, all churches to be exempt from federal income taxes. Thus, just because you are a church, the IRS will not tax the organization for income tax purposes. AND
  2. Most churches that belong to denominational bodies fall under an umbrella that covers all churches in the regional, state or national organization. For instance, the local Episcopal diocese has a letter with the IRS which covers all churches in the Richmond diocese. That way, churches do not have to obtain their own ruling letter from the IRS.     HOWEVER
  3. Times are changing and church finances are getting more complicated every day. In 2008, some churches have intentionally sought to violate the IRS requirement that churches not endorse a political candidate. In 2004, the IRS revoked the non-profit status of 56 churches (albeit temporarily while there was an investigation).  THEREFORE
  4. Because some churches are getting involved in national politics, I am of the opinion that each church should control its own destiny as regards the IRS. I would hate for an umbrella letter (covering hundreds of churches) to be revoked because a few churches in that group decided to flaunt the IRS. My worst case scenario would be that the IRS would revoke the tax-exempt status of the entire umbrella while there is an investigation. In the end everything will work out fine, but in the meantime there can be some heartache because of the actions of other churches. So, my recommendation is that each church obtain its own ruling letter from the IRS. Yes, it is a pain to fill out the forms, get things approved, write a check for a few hundred dollars, and wait on the IRS for a few months, but think about the headache and hassle it could save the church later. Again, I feel it is important to control your own destiny and not potentially suffer because of the actions of other churches.
I hope that helps you and the decision by your church. I’ll be happy to talk with anyone about this.
Lead On!
Steve


Filed Under: church administration, church finances, strategy, wisdom Tagged: , , ,
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