Planting a church can be one of the most rewarding experiences for a leader, but it's also a journey filled with hidden legal dangers. Here are 11 steps to avoid these prominent legal minefields.
Prioritize Children Over Everything Else
As a new church, it’s likely your goal is to reach young families. That means you want to build a children’s ministry parents can trust. For that to happen, you’ll need more than great curriculum—you’ll also need secure check-in systems, trained workers, a safe environment, and policies that protect children and volunteers. Every volunteer should consent to background checks, be trained in how to prevent and report any suspected abuse, and agree to follow guidelines that keep children and volunteers safe.
Incorporate the New Church
Before you sign a contract or host any event, you need to make sure your new church is incorporated; otherwise, you can be found personally liable for any obligations, accidents, or mishaps. Plus incorporation eases the church’s ability to enter contracts, provides organizational stability, and eliminates the need to obtain permission of courts regarding the purchase and sale of real property.
To incorporate the church, you’ll need to file Articles of Incorporation with the appropriate state agency because nonprofit incorporation is a function of the state government, not the Internal Revenue Service. If your church is not part of a larger church organization that is tax exempt, pursuant to Internal Revenue Service § 501(c)(3), your church will also need to submit forms to the IRS to obtain a tax exemption letter.
Draft the Church’s Constitution and Bylaws
Who hires the staff? Who approves the budget? Who can fire the lead pastor? Who votes on what? Who elects the leaders? The Constitution and Bylaws answers all of these questions and so much more. Don’t wait until you’re in trouble to think about these issues; instead, draft the answers before you are faced with the questions.
A good set of bylaws sets out the church’s doctrinal beliefs, establishes the church’s governance model, and protects the church’s ministry and leaders. In many ways, the bylaws determine how the church interacts with its members and how the members interact with each other.
Conduct an Initial Meeting of the Board of Directors
After the church is incorporated, it’s time to have the first meeting of the Board of Directors. While many churches may refer to this group as elders, deacons, or by other biblical terms, as far as the corporation is concerned, these folks serve as the directors of the corporation, overseeing all the corporate affairs of the church. This first meeting fulfills the legal requirements and corporate formalities to establish the corporation, including adopting the constitution and bylaws, appointing officers, and setting other business practices in motion.
Obtain Your Federal Employee Identification Number
Even churches have to work with the IRS. You’ll need a Federal Employee Identification Number to open a bank account, pay employees, and more.
Adopt Key Policies to Protect Your Church
Policies simply say this is how we handle things in this church. Unlike the bylaws, which normally require congregational approval to revise, policies are the work of the pastor and directors. There are several policies every new church needs before getting started.
Have you thought about these? Cash handling policy? Counseling policy? E-Communication policy? Confidentiality policy? Benevolence policy? Housing allowance policy? Transportation policy? Every new church needs the types of policies and more to start on the right foot.
Create Your Church Budget
The budget isn’t about dollars and cents. It’s about mission and values, and it’s an essential tool to keep your corporation legal and protected. As a church, you’ll likely be receiving designated funds—to missions, a guest speaker, building fund, etc. You’ll need a budget and an ability to track all of those contributions to make sure everything goes where its supposed to.
Create a System to Receipt Your Donors
Your donors will want tax credit for their giving to your new church. You’ll need a system to track that giving and make sure donors are receipted in a timely manner. Plus, it helps them keep on giving. The church is required to provide a report to each donor in January of each year, but it’s wise for the church to report contributions to donors on a more frequent basis in order to keep them connected to the mission and provide them with ongoing opportunities to contribute to the cause.
Get Permission to Use Everything
Want to play that movie clip? Display those song lyrics? Use that other church’s materials? It’s fun to say, “It’s easier to get forgiveness than permission.” But, that’s not always true. Your church has an obligation to obey copyright laws or risk the consequences. Fortunately, it’s a simple matter to obtain permission through Christian Copyright Licensing International at www.ccli.com.
Obtain the Right Insurance
Your new church is going to need a variety of policies, including general liability, sexual misconduct liability, directors and officers liability, employment liability, professional and counseling liability, workers’ compensation, non-owned vehicle liability, business auto, and additional umbrella coverage. It’s important to select an agency with a Best’s Rating of A- or higher and that understand the unique coverages church’s require.
The road to launching your church is full of pitfalls, roadblocks, and minefields. But, with the right help, launch Sunday can be right around the corner.
Our Rating is calculated using information the lawyer has included on
their profile in addition to the information we collect from state
bar associations and other organizations that license legal
professionals. Attorneys who claim their profiles and provide Avvo
with more information tend to have a higher rating than those who do
What determines Avvo Rating?
Experience & background
Years licensed, work experience, education
Legal community recognition
Peer endorsements, associations, awards
Legal thought leadership
Publications, speaking engagements
This lawyer was disciplined by a state licensing authority in .
Disciplinary information may not be comprehensive, or updated. We recommend that you always check a lawyer's disciplinary status with their respective state bar association before hiring them.