by NewChurches.com: What are the best financial support options for funding a new church plant?

In Episode 257 of the NewChurches Q&A Podcast, Daniel and Ed discuss various ways to fund new church plants. Here’s Blake with today’s question:

What are different financial support options for a brand new church plant? What are the pros and cons of those options?

In this episode, you’ll discover:

Cautions and considerations for different funding options.
Different funding models such as Full-Funded, Reverse-Tier, and a Shared Partnership Model.

Shareable Quotes (#NewChurches):

“There are a lot of resources to fund your church plant if you cast a compelling vision.”–@edstetzer
“Not every job is a good job for bivocational ministry.”–@danielsangi 
“Bivocational planting is not a penalty, it’s an opportunity.”–@danielsangi 
“You will soon find that your denominational support comes with strings attached. If you receive this support, you will be required to participate in denominational functions. This can be frustrating. Officials will busy themselves with programs that focus on the forest while you try to nurture a single, small-tree.”-Ralph Moore

Additional Resources:

Read this post about Church Planting and Funding Facilities
Learn more about Daniel and Ed’s book, Planting Missional Churches
Check out Daniel’s new podcast, IMbetween Podcast on Marriage, Parenting, Faith, and Everything In Between

Help us Multiply the Mission:

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The post Episode 257: Financial Support Options for Church Plants appeared first on NewChurches.com – Church Planting, Multisite, and Multiplication.

Source: Episode 257: Financial Support Options for Church Plants

The post Episode 257: Financial Support Options for Church Plants appeared first on Passion for Planting.

by Patrick Bradley: Some church groups and denominations have set up an umbrella 501c3 exemption for their churches. There are pros and cons for your church plant if you choose this option.

501c3 is the official nonprofit, tax-exempt status of a charity that allows you to accept charitable donations, issue donation receipts, and not pay taxes as an organization.

There are 3 ways to get a 501c3 exemption for your church plant:

Rely on the automatic blanket exemption
Apply for your own Determination Letter
Use an umbrella 501c3 exemption

The Umbrella 501c3 Exemption

The idea of the umbrella 501c3 exemption is that a denomination or parent organization applies for a special group exemption for their churches. Individual congregations don’t have to apply to the IRS. The denomination keeps track of which churches are part of their fellowship and issues some kind of annual accounting to the IRS.

Each congregation stills incorporates individually, adopts their own bylaws and all that. But they get a copy of the denomination’s 501c3 Exemption Letter and something on denomination letterhead that says, “they’re one of us.”

Umbrella 501c3 Exemption Pros

For the church plant, this is a way faster. Like same-day faster: all you need is the paperwork (above) from the denomination and you’re good to go. Those applying to the IRS directly can expect to wait as much as 6 months to hear back.

And your denomination probably won’t charge you anything. The IRS charges $850 to review your 501c3 application when you apply individually.

Umbrella 501c3 Exemption Cons

The drawback for church plants is that it often creates confusion when you go to ask for charitable donations. Which can happen in 2 ways:

The business you’re courting doesn’t understand why the name on the Exemption Letter (the denomination) doesn’t match your church’s name
The application is online and they can’t find your church’s EIN in the IRS database (only your denomination’s EIN is listed there) – donors like Google and TechSoup don’t seem to make accommodations for this

Other Considerations

You will owe some kind of monthly or annual report to your denomination. They have to keep track of the churches under their umbrella or risk losing the group exemption. Reporting isn’t inherently good or bad – it provides communication, connection and accountability while creating administrative burden. But you should be creating some kind of reporting on your metrics anyway.

There may also be an expectation that you share resources back to the denomination. That can be a very Kingdom-minded thing to do; the collective shared resources of a group of churches can accomplish a lot of good.

One way for you to approach this if you’re part of a denomination or group like this is to join their umbrella 501c3 exemption from day one. Then at any later point you can apply directly for an individual exemption and your very own Determination Letter.

But time is money: The IRS applications aren’t getting any cheaper and every year you delay is a year you won’t qualify for some donations. Also, it’s easier to apply early in the life of your church – brand new churches get to submit proposed budgets, but established churches have to submit financial reports & history.

So pay your money, take your choice.

The post Should You Use Your Group’s Umbrella 501c3 Exemption? appeared first on Church Planting Tactics.

Source: Should You Use Your Group’s Umbrella 501c3 Exemption?

The post Should You Use Your Group’s Umbrella 501c3 Exemption? appeared first on Passion for Planting.