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Incorporation of churches

 Submitted: 11/5/2004
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Question: What about churches being incorporated? When a one-pastor church has incorporated, it is said to be 'just a technicality' and the corporation does not, in truthfulness, go by corporate laws. Would this not be a failure to 'render unto Caesar. . .' and an intentional evasion of accountability? Do collegiate-eldership churches incorporate, and, if so, how does it or does it not mirror sole-pastor apostolic church government? Thanks!
Answer: Corporate law for churches and non-profits varies somewhat from state to state. In general, incorporation is a tool that states have made available for organizations that are handling money and owning property. A corporation is simply a legal entity consisting of certain individuals who are working together for a common purpose. The advantage is that it limits the personal liability of the individuals who are part of the corporation. But it also imposes certain responsibilities.

Whether any particular assembly adheres to corporate law or not has nothing to do with the structure (one pastor vs multiple pastor). It has to do with the integrity of the responsible parties. A group can evade accountability just as easily as an individual. The unfortunate result is that the poor conduct of some can bring hardship on the others. If, for example, the IRS decides to audit a church (which it definitely has the power to do) and finds that the church is not adhering to corporate law or not following its own bylaws, it may decide to check out other similar churches. This has happened in the past with various denominations.

My experience has been that the laws governing non-profit corporations in my state do not in any way adversely effect or burden our assembly. It is relatively easy to comply with the law, which gives us a lot of latitude in what structure we use. Our corporate documents establish an assembly led either by the apostolic founders or a collegial eldership. If we find at any time that we cannot follow our bylaws, it is a simple matter to change them. No church should feel bound by its bylaws; it should instead create bylaws that describe how it intends to operate. The bylaws will then simply reflect the reality rather than control it. This is the purpose of having proper bylaws. They inform any observer (including IRS) how the assembly operates. If it is discovered that a church is not operating the way it said it would, that’s when trouble arises.


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