Newsletter June 2024

You Can Do It, We Can Help

How Do We Incorporate?

Have you incorporated as a church? You don’t have to do this to make disciples and plant a church, but incorporation does offer a church many benefits. One of those is the legal protection that it offers church leaders. Unfortunately, churches get sued from time to time. If a church isn’t incorporated, it may very well be the leaders’ homes and bank accounts on the line in a court of law.

Along with legal protection, incorporation also makes it easier for churches to open bank accounts, enter into contracts, and buy property. 

What do you need to do to incorporate? Visit your Secretary of State’s website (or in a few states, the Corporation Commission) and search for how to start a new nonprofit or religious entity. 

In most states, you’ll file the document online. But be careful! Your state probably won’t require you to include the nonprofit language that the IRS will require for your later 501c3 filing, which is at least:

• A Purpose Clause that meets IRS standards
• A Dissolution Clause that conveys assets to another nonprofit.

If you don’t include these, the IRS will make you file an amendment later when filing for 501c3 status.

Our Articles of Incorporation Template provides sample language for those clauses and other things you may want to include. Requirements vary from state to state, and how you word the IRS-required clauses should be specific to your church, so make sure to consult an attorney before filing.

We hope our template gets you pointed in the right direction!

Do We Need 501c3 Status?

Here at Passion for Planting, we get emails and phone calls on a regular basis from church planters asking whether or not they need to have formal 501(c)(3) tax exempt status from the IRS to receive tax deductible gifts. The answer is no.

According to IRS Publication 557, as well as IRS Code 508: “Churches (including integrated auxiliaries and conventions or associations of churches) that meet the requirements of section 501(c)(3) of the Internal Revenue Code are automatically considered tax exempt and are not required to apply for and obtain recognition of exempt status from the IRS.”

So breathe a sigh of relief, church planter. If you’re organized as a church and behaving as a church, your church falls in this automatic exemption. Churches that are automatically exempt can tell their financial partners that charitable gifts are tax deductible even though the new church doesn’t have a 501(c)(3) determination letter with its name on it.

But we do recommend every US church planter apply for 501(c)(3) exempt status anyway.

Why would a church go through all the hassle of applying for its own 501(c)(3) Determination Letter? Here are a couple of quick reasons:

• many donors, especially foundations and corporations, have made their own requirement that donations can only be made to entities which have their own 50(c)(3) determination letter
• many state governments will not grant your church sales tax exemption without its own 50(c)(3) determination letter

Applying for and receiving official, written 501(c)(3) exemption establishes you church as a recognized nonprofit and settles many issues like these.

Also read these helpful blog posts over at Church Planting Tactics:

• How To Apply – Church Plant 501c3
• Sales Tax Exemption Benefit
• When Is My Church Plant 501c3?
• Are Missional Communities 501c3?

How To (re)Write Bylaws

Some churches adopt bylaws only for compliance or control:

• they just want to satisfy some legal requirement and end up creating “shelfware”, or
• they follow a overly-pragmatic approach, such as wanting to prevent a pastor from having too much control

This doesn’t have to be the case, though.

At Passion for Planting, we help church planters develop contextualized bylaws that align with scripture, so they can pursue the vision God has entrusted to them with the support and guidance of Biblically recognized leadership. 

While it’s easy to copy and paste your church’s name into the bylaws of the church down the street, what you gain in convenience might not be worth what you lose in appropriate customization. Before creating or revising your church’s bylaws, review our Church Bylaws Checklist and use our free Bylaws template to write or rewrite your church’s bylaws, so they support your mission of saturating your city with the gospel. 

Help Managing Your Church Planting Efforts  

Most church planters are visionaries. They can envision the preferred future God has in store for their ministry. Unfortunately, it’s not uncommon for them to face challenges turning that vision into reality due to a lack of planning. While they excel in discerning vision, they sometimes struggle with its practical implementation.

To address this issue, we developed PlanterPlan, a comprehensive software checklist tool that maps out over 400 tasks that US church planters typically need to complete as they work towards turning their church planting vision into reality. These tasks are grouped and sequenced to ensure that you are doing the right things at the right time while starting a new church or campus. 

Thousands of church planters have already leveraged PlanterPlan to guide them in their planting efforts. Each task in the plan template has a description and clear instructions, and many also include a range of downloadable tools and resources. Yes, it even includes step-by-step instructions for all of your legal filings in the US.

Your PlanterPlan task list is customizable, and it will become a powerful delegation tool for you through its team functionality. Don’t wait to start utilizing this valuable church planting tool today!

Photos by Nicolas Lobos and Sebastian Pichler from Unsplash.