Forming Church Congregations
Without IRS 501c3 or Incorporation

Should a church group incorporate and obtain tax exempt status under Internal Revenue Code section 501(c)(3)?

This is a frequent point of debate among churches. There are varying opinions about the theological and economic effects—both present and future. A group that incorporates and obtains 501(c)(3) status usually has an easier time assuring those who support it that their offerings will be “tax deductible”—though offerings to churches without “501(c)(3) status” are also “tax deductible”. Incorporation provides certain protections to the personal assets of church leaders, but also creates numerous obligations and potential liabilities for the church and its leaders. Incorporation is distinct from 510(c)(3) tax exemption—it is possible to have one, the other, both or neither.

The IRS publications explain that Churches do not need to fill out form 1023 to become tax exempt--that they are automatically tax exempt. But making tax exemption easier by obtaining a "501(c)(3) status" is also a promise to obey all current and future regulations. These regulations are often somewhat unclear and selectively enforced. Most churches are never affected by them. Others are forced to change their message--or even disband. Should a church congregation place itself under state regulation when it can place itself directly under God? Remember the whole scripture:

And Jesus answered and said to them, "Render to Caesar the things that are Caesar's, and to God the things that are God's." And they marveled at Him (Mark 12:17)

Incorporation is done at the state, not federal level. The members of a church have the right to create it, and it is subject to the Scripture and to God. Whereas states create corporations, and they have the right to regulate them--and sometimes regulate them out of existence!

The IRS section 501(c)(3) and corporations certainly have application for a host of businesses and charities. But they do not make sense for churches, as Jesus said:

...I will build my church, and the gates of Hades will not overcome it (Matt 16:18).

Christ is also the head of the church, which is his body. He is the beginning, supreme over all who rise from the dead. So he is first in everything(Col 1:18)

See the Church Bible articles at right for more information on the biblical basis for church organization.

Legal Status of these Web Pages

This website and articles at right are written by the command of Jesus that His followers be witnesses of Him “to the ends of the Earth” (Acts 1:8). The author asserts his right to produce them according to the inalienable rights of freedom of religion, freedom of speech and freedom of the press, which are recognized by the First Amendment of the Constitution of the United States of America.

The purpose of these writings is to provide useful teaching and information for forming church congregations. The author grants permission for them  to be copied in whole or in part, as long as it is distributed free of charge. The author believes the information herein to be accurate, but realizes that it changes over time and that he is fallible, so he would appreciate corrections of any errors. This website is not professional or legal advice. Anyone making a decision based upon this paper should seek God in prayer first, and realize that they are making their own decision and that the author of these writings and those who distribute them are not liable for their decision and its consequences. People not capable of making their own decision or wanting “legal advice” should seek a “licensed professional”.