Administrative Assistance

There is no state or federal law requiring you to have By-Laws.  But without By-Laws, your church [or fellowship] would not be tax exempt in the eyes of either the state or the IRS. And in the event of an audit, any and all income would likely be ascribed to the leader [pastor] or leadership  One of the “Key” elements evaluated, in order to be deemed tax exempt, the church is required to have some form of organization - eg:
* a Non-Profit Corporation;
* a Trust; 
* Or - an Un-Incorporated Association.
And in all three cases, you are required to have By-Laws.  If choosing to remain un-incorporated, the By-Laws must contain the four IRS required phrases - which are normally found in the Articles of Incorporation. By-Laws are the "Rule Book," of the organization. The By-Laws are what describes how the organization is run – eg:

•     Directors - How many are required; How they are elected/appointed; Their power, or authority; The term of office; Process for removal.
•     Pastor – How is he called or appointed;  His term of office; What are his duties; His responsibilities; authority; Accountability; And how his successor would be chosen.
•     Developing the means of handling an accusation against the pastor or an elder; [Who will judge]; Developing levels of accountability structure to prevent; A “Korah/Absolam/Jezebel spirit led type of uprisings within the church; And provisions carefully designed to protect the flock of God against a pastor should he become errant in teaching the true Word of God; Or if he would develop a medical imbalance that would lead to a change of his/her personality, eg: Bi-Polar disorder, aka ‘Manic Depressive.’  I raised the question earlier, ‘Who will judge,’ for it should never be left to the sheep to judge the Shepherd; This is a role that must be reserved for other ordained ministers - a panel of ordained ministers agreed upon earlier on, and whose names are found in the official Minutes of the meetings of the Board of Directors.
•  Membership – Their qualifications; Rights; Responsibilities.
•  Purposes for which the organization was created are more specifically outlined;
•  And IF incorporated, that the organization will Indemnify the Officers and Directors. [This means that the organization’s assets will be used to defend you in any lawsuit.]
• Tenants of Faith – What does the Church believe;  This section is where we must ‘load’ the By-Laws with the Word of God, so that if we are ever sued we can use the Word and the Name of our Lord Jesus Christ in the courtroom.  The By-Laws reflect the churches theology of government.  Therefore, it is imperative to consider and identify true Biblical patterns of Church Government, and write By-Laws that will allow God’s appointed and anointed leaders to lead, guard, guide, disciple, discipline, love and equip the people on a Biblical basis – yet having accountability to other approved ministers.
• Ministry Credentials: Qualifications; The process; Types of credentials eg: Ordained, Commissioned, or Licensed;  Authority granted to each; Accountibility with required reports to the church would all be defined in the By-Laws
  
• Discipline:  The means and process of discipline would be defined for both members and non-members.

In the event of a lawsuit, if you are incorporated, your By-Laws would be examined by the Judge to determine just where liability [if any] would apply.  By-the-way, we have found that about 80% of the churches never had an “Organizational Meeting,” where the By-Laws were adopted.  This would be the first thing a judge would look for.  If there are no corporate Minutes of such a meeting, he would likely rule that the corporation was never properly formed, and is thereby invalid. The claimant would automatically win his case.  See - Sin_Of_Omission  If you recognize this to be your problem as well, it is easily resolved.  We have written a manual that specifically addresses this situation – See - More_Sample_Minutes/

May I share a little at this point about the essence of a “Democratic” form of church government?  We can find no Biblical basis, in the Old or New Testament, for this form of government.  For that matter, whenever the people in the Old Testament attempted to institute a “Democratic” form of government [with the people ruling over the man of God, God intervened with harsh judgment, and people died,  To read two On-Line articles I have written about church By-Laws, please – See - Church_By_Laws    AND -  Structuring_for_Lawsuits

To reiterate what I said at the outset of this article, to be tax exempt, there is the basic requirement [by the IRS] to have By-Laws, and Minutes in the organizations Minute Book that document the fact that all money spending decisions were made only by those authorized by the By-Laws.  These two things are the most important in making the organization 501 (c)(3) tax exempt.  See the On-Line Article I wrote about this subject at - What_is_501_c_3       

In order to be tax exempt, there are several other points to be aware of as well.  I have written 35 On-Line Articles, answering many of the questions church leaders have;  They may be of help to you as well – blog_index.php



Take a look at our SAMPLES Manual, where we have published more than 100 sample Church Policies and Minutes of Board Meetings, and our  Samples – Addendum Manual  More_Sample_Minutes/ , where we have addressed not only the Ratification issues, but have several more Sample Minutes.

If this discourse is of interest to you, or if you would like more information about similar issues, please consider "The Church Administration 'How To' Manual." This Manual, endorsed by three CPA's, an EA and two attorneys, was updated again in January, 2010, for the 11th time, since its original publication in 1991.

The above information is provided as a service to the Body of Christ by ADMINISTRATIVE ASSISTANCE – Rev. Don L.  Buckel - Director.  8419 Vista del Cajon Pl. Lakeside, CA. 92040  Don@admin-assist.com. Please feel free to call us at 619/443-5221. Please allow for West coast time zones, and call after 8:00AM
Blessings,

Don L. Buckel