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Legal Q & A

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Finance & Tax

   

Q: Does our ministry need an Employer Identification Number (EIN)?

...Every ministry should have an Employee Identification Number (EIN). An EIN for an organization is like an individual's Social Security Number...

Q: How do we protect ministry finances against theft?

...We recommend you develop a comprehensive written policy governing ministry finances...

Q: How should a church or ministry respond to requests for support from political groups and candidates?

...Churches must use caution when becoming involved in political activity to avoid losing their 501(c)(3) tax-exempt status...

Q: Is our ministry automatically tax-exempt?

...Churches are exempt organizations, however, other not-for-profit organizations must be “recognized” by the IRS as qualifying for 501(c)(3) status...

Q: What is the Unrelated Business Income Tax (UBIT)?

...The Unrelated Business Income Tax (UBIT) is collected on all income earned apart from an organization's tax-exempt purpose...

Q: What political activity is prohibited by tax-exempt status?

...501(c)(3) tax-exempt organizations are prohibited from influencing legislation and Political Campaign Interventions...

Q: What should ministry leaders know about donations that are directed by the donor to go to a specific individual or program?

...Gifts generally must be made to the ministry or a specific ministry program, rather than an individual...

*Important information: Brotherhood Mutual is pleased to provide LegalAssistance as a complimentary resource. The services we offer through LegalAssistance are intended to provide general legal information to our current and prospective policyholders.

The information we provide is intended to be helpful, but it does not constitute legal advice and is not a substitute for the advice from a licensed attorney in your area. Accordingly, no attorney/client relationship is created through this process, and no legal advice will be provided. We strongly encourage you to regularly consult with a local attorney as part of your risk management program.

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