Blog Archives

9/27/2018

Called and Educated, but Unprepared

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Jack has faithfully served God for years. It was no surprise to those who knew him when he felt God had called him to become a Pastor. Jack thought he should attend Bible College to properly prepare for the new role God had placed upon him.

After graduating with a Bachelors degree in Ministry, Jack accepted the role of Senior Pastor in a little country Church in the Midwest. All was fine until the first Board Meeting. Nothing he learned in Bible College prepared him for the hostilities that would arise in that meeting. That is when Jack turned to us—the number one Church Management firm in the USA. We knew the dilemma with which he struggled and offered the necessary solutions to his problems.

Just like Jack, when a Christian enters the ministry he or she feels the necessity to prepare for God’s Call spiritually and educationally. To fulfill the later many attend a Bible College or Seminary. After all, a Pastor should be prepared for the demands that ministry places upon him or her. With Degrees in Bible and Theology, you would think they would be prepared for ministry.

Unfortunately, most Pastors are in the same category. Bible College teaches all of the “ologies,” i.e. Angelology, Eschatology, Soteriology, etc. but not the things a Pastor needs. All of those are great, but Bible Colleges and Seminaries need to develop a class in “Pastorology.” Most Pastors leave Bible College to enter pulpits across America, but have no idea as to how to conduct a Board Meeting.

The Pastor as the CEO

The Pastor of a Church is automatically considered as the CEO of that organization, yet many have no clue what it entails. Not only do the Pastors have no clue, the Church Board will often withhold that power from him or her.

No, large business would think of voting in a CEO without vetting the credentials of the new officer. Yet, most new Pastors step into Pastoral positions unequipped to manage and operate a Church. For me, it was only after I was a Pastor for a week, that I realized the spiritual training I had received, was insufficient for day-to-day Church operation. Church is about 10 % spiritual, and 90 % administration.
Pastors in these situations are then shaped by Board Members who usually have no clue as to the proper way to run a Church. The same irregularities that have been present in that Church for years, have now been implanted into this next level of Ministry via the Board to the new Pastor.

There is Help

If you are a Pastor that has not received proper legal and administrative training to operate the Church you Pastor, you need our help. We are the specialists in Church Management. We know things others do not know. It is not what you know that will hurt you—it is what you don’t know.

In our Church Management and Clergy Conferences, we keep Pastors and Church Leaders abreast of all of the new regulations and updates to keep the Church compliant. We also have the training to show Pastors how to properly conduct Board Meetings.

The question becomes, “Do you want to stay where you are—in administrative error, or do you want to get your Church in Government and administrative compliance?” Please understand that God does not bless a mess. The reason your Church struggles could be because your Church is out of order.

Every Pastor and Church Leader should contact us today to register for the next Church Management and Clergy Conference in a city nearest you. To register, please call 800-344-0076 or visit us at www.cmtc.org.

For us, this is “A Ministry—Not a Job!”

By Dr. Michael Chitwood

What You Will Learn at our Conferences

Our Church Management Conferences will arm you with the information you must have to shield your Church or Ministry from IRS intrusiveness; teach you how to get your Taxes to the lowest possible rate; and daily operate your Church or Ministry within IRS acceptable guidelines.

Our Conferences have been taught across the Nation for over 48 years. Because of the Penalties, Fines, and even Imprisonment that the IRS imposed on many Churches and Pastors, Dr. Chitwood felt led by the Holy Spirit to become a buffer between Churches, Ministers, and the IRS.

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9/18/2018

Is Improper Stewardship Hindering Your Church Growth

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Pastor Smith asked to speak privately with me during the lunch break during a recent Church Management and Tax Seminar. Once all of the class left the room for lunch he began to tell me a story I have heard often in the 46 years of teaching these seminars. He confessed that his Church was committing serious violations, and needed our help but his Church of 20 years was a small congregation and could not afford the funds to retain us. It was then I told him that which he probably did not want to hear.

I began to share with him the parable of the talents in the 25th Chapter of Matthew. The Master did not give each of the three stewards the same amount—He gave to them based upon their proven ability of what they could handle and manage. I then told Pastor Smith that God probably would not allow him to get any larger because he had a proven track record of mismanaging that which God had sent him—i.e. his Church in financial disorder and serious IRS violations. I then asked him to justify why God should give him more people and more money. His words were, “If God would grow my Church numerically and financially I would get our Church in order.” Unfortunately, for him, God doesn’t operate that way. The principle is the same as that of tithing. Many people use an excuse that they cannot afford to tithe, but want the Pastor to pray they will win the Lottery, and if they do, they will give the Church a big tithe check. That doesn’t happen. If someone can’t give God $20 on a $200 paycheck they wouldn’t give tithe ten million dollars if they won a hundred million.

Life Demands that We All Pay—It is Only a Matter of When

Scripture reminds us that if we cannot be trusted in the small things we cannot be trusted with that which is larger. Pastor Smith had to choose—Sacrifice now, get his Church in order so God could bless it or continue on the same path he had been for 20 years. To his credit he made the right choice. Pastor Smith’s dilemma reminded me of the old commercial on TV.

Many years ago there was an oil filter commercial that used the statement: “You can pay me now or you can pay me later.” The theme was that if you got the oil changed regularly in your automobile and used the Fram oil filter, it would save you major repair bills later. The premise being that it was much cheaper to pay $15.00 for an oil change and new oil filter than to pay hundreds of dollars for major engine repairs.

The Same Rule Applies to Your Church

The Internal Revenue Service is changing rules and regulations daily and most Churches have no clue as to how the new regulations and laws affect them. Would it not be better for a Church to spend a couple of hundred dollars each year to learn the changes and stay in compliance than it would be for the IRS to show up at your door and your Church be penalized thousands of dollars and possible prison time for the Pastor and Church Leaders?

Unfortunately, most Churches would rather “roll the dice,” save a couple of hundred dollars, and pray that the IRS does not catch them in their violations. The Apostle Paul admonished Christians to obey the laws of the land in Romans 13:1-6, yet many Churches purposely and knowingly violate IRS regulations every week.

God Cannot Bless A Mess

If God sanctioned or blessed something that was illegal, He would be less than God. I understand that Apostle Peter said, “We ought to obey God rather than man,” but that statement only applies when the laws of the land violate or contradict God’s Word. Nothing in the IRS code violates or contradicts God’s Word. Therefore we are commanded to obey those regulations or we are in rebellion to Scripture.

When the Children of Israel went to war with the city of Ai they were soundly defeated. Their demise was attributed solely to one man violating God’s command. Everyone was told to touch nothing in the city of Jericho because God commanded that everything in that city be destroyed. Achan took a wedge of gold and a Babylonian garment. His rebellion was considered by God as if the whole nation rebelled. Innocent men of Israel died in the battle of Ai simply because one man thought he could disobey God and no one would ever know.

Pastors and Church Leaders, how many people in your congregation are suffering because you did not feel it necessary to obey God’s Word which demands that you obey the laws of the land? All of those IRS violations that are committed in your Church every week are not unnoticed by God. Could it be that your Church and many in your Church are struggling because you feel that no one will know you are operating against the laws of the land?

We Can Help

Chitwood & Chitwood is the premier Church and Clergy tax expert in the nation. We are experts on the IRS and even know many of the laws before they are released to the public. Every year we crisscross this nation teaching Church and Clergy tax seminars to keep Churches abreast of IRS regulations. To attend one of these seminars is $99.00 plus a workbook.

At these conferences you will be shown how we can get your Church in compliance with the latest IRS laws and bring it into proper financial order. God demanded good stewardship in Scripture. No Church is a good steward of God’s money when they purposely refuse to learn the IRS regulations which apply to a Church, the Pastor, and Church Leaders. Could it be this is why so many churches seldom exceed 70 in attendance? Could this be the cause as to why so many churches struggle financially?

I would encourage every Pastor and Church Leader to attend the next Church Management and Tax Conference closest to their location. To register, call 800-344-0076 or visit our website at www.cmtc.org. Everyone pays; it is just a matter of when. You will pay a small amount to learn the new IRS regulations and how to get your church in compliance, or you will pay heftily in the form of IRS penalties, including possible prison time.

Act now. Once they show up at your door it is too late.

By Dr. Michael Chitwood

What You Will Learn at our Conferences

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9/11/2018

Pastor Can’t Cope with the Pressure

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I was troubled, but not shocked, by the news I received last night. Another Pastor, whose name I will withhold due to the pain the family is suffering, ended his life. The cause of death was listed as self-inflicted.

This 30 year old Pastor had a thriving Church, a beautiful family, and Church members who adored him. Although some recognized his emotional trouble, apparently no one knew how to properly assist him through the journey so he could conquer it and use it as a testimony to others.

A Common Occurrence

Pastors are among the most depressed and most burned out employment group in the USA. They walk a fine line between their spiritual life and their human, personal life. They must be appear outgoing and friendly with members and those whom they hope will attend their Church, but also must maintain a spiritual life acceptable to God. A Church attendee may tell a joke that is slightly off color, expecting the Pastor to laugh, but at the same time it may be unacceptable to the Holy Spirit.

The Pastor’s family is usually held to a higher standard than other Church members. This inequality pits the Pastor against protecting the rights of his family while maintaining a certain standard visible to his Congregation.

Another Factor

Issues the Pastor confronts with Church Members who want to live below the Church’s Biblical standards, but still want to be leaders in the Church, and disgruntled Board Members who did not get their way in the Board Meeting are things the Pastor must keep locked within the confines of his soul. Pastors keep these and many other issues from their spouse for fear the spouse will unload on the Church or Board Member.

The Pastor’s spouse is expected to be nice to those in the Church when the spouse would probably rather take them out behind the Church and beat some sense into them.

The stress of trying to keep Church Members content so they will continue to attend and tithe while trying to be supportive of his spouse and children often places the Pastor in a lose-lose situation. If the Pastor wins with the Member, he or she often loses with his or her own spouse or children.

Pastor’s Wife Leaves Rather than Fight with Husband

Pastor Brown sat in his chair on the platform during that Sunday Morning service. His wife’s routine usually had her arriving to Church at 10-15 minutes after the start of the morning service. This kept her from having to contend with the gossip and backbiting among Church members.

This Sunday she was later than usual. Service had been going for about 30 minutes and still no sign of the First Lady. Praise and Worship would be finished in about 10 minutes and out of concern, Pastor sent his Head Deacon and his wife to see what could possibly be wrong. Pastor had the Music Pastor continue Praise and Worship for another 20 minutes. By then the Deacon and his wife returned, but the look on their faces did not paint a pretty scenario.

They called the Pastor out of the Sanctuary to give him the bad news and the note from the First Lady. They told the Pastor that his home had been emptied of its furniture and they found the note from the First Lady which read: “I cannot handle the pressure placed upon me as a Pastor’s Wife nor can I handle you walking a tight rope trying to please me or please your congregation. Please do not look for me. You will be hearing from my attorney soon. I wish you all the best.”

The Loneliest Position on the Planet

The Pastor to which I referred to open this Blog committed suicide. The Pastor, to which I just referred, lost his family. Neither scenario is pretty.

A Pastor usually walks alone in the city in which he or she pastors. Some Pastors have friends in other locations with which he or she “can let their hair down” without it posing any negative consequences to his or her Ministry. Unfortunately, most do not have that option.

Therefore, the Pastor walks alone—at least in the natural realm.

Why You Need Us

Every Pastor should become connected to The International Congress of Churches and Ministers (ICCM), and should attend the next Church Management Conference closest to your location.

With more than 80 years of experience providing oversight to Ministers and Churches we are the safety net which Pastors can fall upon when the stress and struggles of Ministry become unbearable. No Pastor should ever entertain the thoughts of suicide or the attacks of depression. You Do Not Have to Go it Alone! We are here for you.

Even though you may be ordained through another organization you can connect with us by calling 800-854-5891 or visit us online at www.iccmworldwide.org. We encourage every Pastor to register for the next Church Management Conference by calling 800-344-0076 or registering online at www.cmtc.org.

DO NOT ALLOW THE ATTACK OF LONELINESS OR DEPRESSION DESTROY WHAT GOD HAS CALLED YOU TO—WE ARE HERE FOR YOU!

By Dr. Michael Chitwood

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9/6/2018

Pastor Taxed on Salary He Did Not Accept

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Speaking with Pastor Simpson during the break, he informed me no one in his Church received a salary, including him. Therefore, some of the information in the class did not apply to him. I asked him if the Church had ever offered him a salary, to which he replied, “Yes, but I refused it.” Questioning him further on this I realized he could be in serious trouble because of a little known Treasury Regulation.

I informed Pastor Simpson that the IRS may very well tax him on the compensation he turned down. This information shocked the Pastor in such a manner he became very anxious. Then I explained why.

It was only a few months later that Pastor Simpson relayed the news of which I was concerned he would hear. He had to pay taxes on the income he had turned down and was hit with additional penalties and interest.

What Pastor Did Not Know Hurt Him

There are thousands of pages of Internal Revenue Service regulations that pertain to Churches. I do not know of any Church Treasurer that is aware of everything written in the statutes that apply to their tax exempt status. Most Church Clerks do not know one law that compiles Church tax law, much less all 277.

Buried in those thousands of pages is a clause known as Treasury Regulation CFR 1.451-2(a) which is known as Constructive Receipt of Income. This regulation allows the IRS to tax income, even if it was not received by a Pastor.

What the Statute Means

The basic premise of this statute is this:

“Income although not actually reduced to a taxpayer’s possession is constructively received by him in the taxable year during which it is credited to his account, set apart for him, or otherwise made available so that he may draw upon it at any time, or so that he could have drawn upon it during the taxable year if notice of intention to withdraw had been given.”

This means that any income refused by the Pastor is taxable if it meets any of these three stipulations.

1. If the money has been set aside for the Pastor.

2. If it is credited to the Pastor’s account.

3. If it is otherwise made available to the Pastor, but he or she refuses it.

The Pastor’s “Church Comes First” Mind-Set May Prove Costly

As I travel across the nation teaching Church Management and Tax Conferences I constantly encounter Pastors who will not accept salary from their Church simply because they are in the growth process and they are willing to make the sacrifice to see their Church improve.

As oversight for thousands of Churches in the USA, I understand the Pastor’s heart. However, no Pastor should be so humble as to place themselves and their families in unknown financial peril.

Necessary Precautions

Any Pastor who chooses not to accept a salary must make sure he or she does so with these guidelines in place if he or she wishes to avoid taxation from the IRS.

1. Make certain that any income you refuse is not made available for you to draw upon at any time.

2. Make sure that any income you refuse does not go toward something that would benefit you or your family in the future.

3. Be certain that any income you refuse is not credited to your account now, or in the future.

4. Make certain that your decision is properly recorded in Board Meeting Minutes prior to you refusing the income.

Why You Need Us

These and other vital tax issues are taught in our weekly Church Management Tax Conferences all across the USA. Our 80 years of experience and knowledge make us the premier Church Management firm in the Nation.

Every Pastor and Church Leader should make it their number one priority to attend the nearest conference immediately. Your procrastination may prove to be your demise. Visit us at www.cmtc.org or call 800-344-0076 to register. You and the safety of your Church are not guaranteed tomorrow.

Remember, for others it is a job, but for us “It is A Ministry!”

By Dr. Michael Chitwood

What You Will Learn at our Conferences

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9/4/2018

Ready or Not—Here They Come

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Pastor Samuel told me that he did not need our services simply because he never worried about IRS (Internal Revenue Service) intrusion into his Church affairs. He was sure the IRS could not investigate him unless the head of the Internal Revenue Service or some higher official approved such action. All of his thinking abruptly changed.

When I received his panic, anxiety-laced call I knew he was in deep trouble and that it may be too late for us to help him avoid that which was about to happen. Needless to say, things did not end well for this Pastor.

Three Words Which Strike Fear in the Hearts of the Hearers

I don’t know of any letters or words that strike fear in the heart of individuals like the three dreaded letters, IRS. It is probably only second to the word “cancer.”

Many Churches feel as if they never have to worry about a visit from the IRS. That used to be almost true. In years past, before the IRS could perform an audit on a Church, the Internal Revenue Service had to follow guidelines outlined in Section 7611. That section of the IRS code required “an appropriate high-level Treasury official” to approve a tax inquiry on a Church. Those days are gone forever.

If a Church is audited after the 7611 wall is successfully maneuvered, there is no hope of appeal for that house of worship.

Church audits are up over 50% from the past year and the statistics are changing daily. The reason for the increase is because the IRS is gradually eroding the 7611 audit threshold. This is due to the addition of the Affordable Care Act to IRS oversight and the ability to perform Employment Tax (941) audits.

Many Pastors’ Heads Are in the Sand

While conducting a recent Church Management Tax Conference, an African-American Pastor politely informed me that his and other African-American Churches did not have to worry about the IRS because the President had assured them that he was their friend and would protect them from infringement into their records. The only problem is, that for the past 7 years there has been a steady increase in the number of Churches audited, and a majority of those have been in African-American places of worship.

Just a few weeks prior to this blog, I sat with a Pastor that arrogantly told me his Church books and records were in order because he had a former H & R Block tax expert managing the financial records of the Church. Upon asking a few simple questions of the Church bookkeeper it was evident that they were far from IRS compliance, and yet the Pastor continues to feel as if he is exempt from IRS Scrutiny.

Internal Revenue Service Actions

Due to the Affordable Care Act (ACA), the IRS is now performing random, on-site audits of Churches. In performance of those audits, 941 Employment Tax audits become “fair game” for the auditor. 7611 requirements are non-existent for ACA and 941 audits.

In performance of those audits, the auditor may seek to view the facility and may ask questions. Anything that ignites suspicion during the audit or walk through will flag a more in-depth review, which usually creates some problems for that Church.

The last thing any Church needs is to be bogged down in an IRS audit. Not only is it stressful, it may provide serious criminal and civil ramifications for the Church.

What You Need to do Immediately

Every Pastor and Church Leader should contact our office, Chitwood & Chitwood, to schedule an on-site compliance audit immediately. If the Church cannot afford an on-site audit, its Leaders (including the Sr. Pastor) should register and attend the soonest and nearest Church Management Tax Conference to learn how to get compliant and retain our services via a discounted system.

There is absolutely no time to loose or waste. Every Pastor and Church Leader should immediately call 800-344-0076 or visit us at www.cmtc.org to register. We have a conference near you. It will be the best day you have ever invested in for your Church and Ministry.

Remember, for others this is an occupation, for us “It is A Ministry—Not A Job!”

By Dr. Michael Chitwood

What You Will Learn at our Conferences

Conferences

Contact

More info

Called and Educated, but Unprepared

The Pastor as the CEO

There is Help

By Dr. Michael Chitwood

What You Will Learn at our Conferences

Is Improper Stewardship Hindering Your Church Growth

Life Demands that We All Pay—It is Only a Matter of When

The Same Rule Applies to Your Church

God Cannot Bless A Mess

We Can Help

By Dr. Michael Chitwood

What You Will Learn at our Conferences

Pastor Can’t Cope with the Pressure

A Common Occurrence

Another Factor

Pastor’s Wife Leaves Rather than Fight with Husband

The Loneliest Position on the Planet

Why You Need Us

By Dr. Michael Chitwood

What You Will Learn at our Conferences

Pastor Taxed on Salary He Did Not Accept

What Pastor Did Not Know Hurt Him

What the Statute Means

The Pastor’s “Church Comes First” Mind-Set May Prove Costly

Necessary Precautions

Why You Need Us

By Dr. Michael Chitwood

What You Will Learn at our Conferences

Ready or Not—Here They Come

Three Words Which Strike Fear in the Hearts of the Hearers

Many Pastors’ Heads Are in the Sand

Internal Revenue Service Actions

What You Need to do Immediately

By Dr. Michael Chitwood

What You Will Learn at our Conferences

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