Giving Policy for FAITH Church
INTRODUCTION
FAITH Church is a qualified charitable organization exempt from federal income taxes under IRS Sec 501(c)(3). Contributions to the church are deductible for federal income tax purposes under the rules and regulations established under the current provisions of the Internal Revenue Code.
TYPES OF CONTRIBUTIONS
Generally speaking, a contribution to the church is either 1) undesignated, which supports the yearly budget of the church through our General Fund, or 2) designated giving, which supports other approved funds or projects of the church (which may or may not be part of the yearly budget.) The purpose of this policy is to set forth how both kinds of gifts will be treated in order to be considered a tax deductible contribution. The following terms are used:
• Tax Deductible Contribution – a gift of cash or property given to a qualified organization by a donor who receives no tangible benefits from the gift and gives up full control of the gift for the organization to use for its purpose and mission.
• Undesignated Gift – A gift that is given without designation. The yearly budget is funded primarily through undesignated gifts, and as such, donors are encouraged to give without designation.
• Designated Gift – A gift that is designated for a specific fund (other than the General Fund) or ministry project. Designated giving will be accepted only for funds or special projects that have been approved by the Board and Pastoral Leadership.
FUNDS AND DESCRIPTIONS
• General Fund – The General Fund includes all undesignated gifts from our weekly tithes and offerings, and is used to support the ministry of the church. Each year, the Budget Committee prepares a yearly budget that is approved by the Board. This budget will guide the disbursement of funds from the General Fund.
• Missions Fund – The church, in the exercise of its religious purposes and mission, has established a Missions fund to provide resources for the church, church members, or other worthy persons or organizations spreading the gospel of Jesus Christ. The fund can also provide resources to church members or other worthy individuals for short-term mission trips or support of long-term missions. Special emphasis will be placed on using this fund to engage our local community through special projects and service needs. It will also be used to support local ministries and organizations. The church welcomes contributions to the fund. The administration of the fund, including all disbursements, is subject to the control and discretion of the Board and Pastoral Leadership. The Board and Pastoral Leadership may consider recommendations from anyone, but in no event are they bound in any way to honor the recommendations. Donors will not be permitted to recover a contribution on the grounds that the team failed to honor the donor’s recommendation. The church recognizes that spreading the gospel is the primary purpose of the church and has established this fund as an ongoing fund. Should at any time in the future the Board and Pastoral Leadership choose to close this fund, all money in the fund at that time will go into the general fund of the church.
GIVING POLICIES
1) The General Fund makes up the yearly operating budget of the church and is supported by undesignated giving. A designated gift for a special approved project under the General Fund will not increase the yearly budget but it will increase the available funds for that project.
2) Any gift designated for a budget line item expense (under any fund) will be posted to that line item and will not increase the annual budget but it will increase the available funds for that line item.
3) The church will not accept any Restricted Gifts whose use is restricted by donors. The church has no discretion in the management and disbursement of such funds. Whereas for Designated Gifts, the church will make every reasonable effort to honor designated gifts. However, according to IRS regulations, in order for a gift to be considered a tax deductible gift, the church must maintain full control over how the gift is used.
4) The church will not accept gifts for ministries outside of the church asking to forward the donation to that ministry UNLESS the church has taken up an offering for a specific purpose for a specific time frame. The church encourages people to give directly to outside ministries that they would like to support.
5) The church is able to accept non-monetary gifts. Contact the Church Office for details on how to contribute non-monetary gifts. No value will be reflected on your contribution statement . The deductible amount allowed by the IRS depends on information that you should obtain from your broker, so please confer with your broker as to the exact value that you can deduct.
6) The value of personal services donated is not deductible as a charitable contribution. The church relies heavily on volunteers to fulfill its ministry. However, donations of this type cannot be reflected on the individual’s record of giving.
7) We are often asked if one can just receive contribution credit for items bought for the church’s ministries instead of being reimbursed. We are always grateful for the generous spirit of our people and we want to do what we can to accommodate this request. We do have to establish an adequate trail to substantiate the gift, however. We ask these donors to go ahead and submit a check request for the reimbursement—which will be reviewed and approved by the Board and/or Pastoral Leadership. They can then return the money as a contribution and designate it to the ministry that incurred the expense.
GIFTS TO INDIVIDUALS
Gifts designated to a specific individual do not qualify as charitable contributions under IRS regulations. Donors should provide those gifts directly to the individual.
REFUND POLICY FOR CHARITABLE CONTRIBUTIONS
All charitable contributions will not be refundable and will not be returned to the donor. To refund the gift would be contrary to the basic definition of a charitable contribution and could have possible tax implications to the donor and potentially cause a liability to the church.
Redistribution of a designated contribution will be handled in the following manner:
• Mission Trip Designation – Gifts designated for individuals to cover mission trip expenses are considered tax deductible as long as the donor has the understanding that the designation is a suggestion and the gift is ultimately under the control of the church to use as it deems necessary. Donors need to understand when they designate a gift for a specific individual in support of a mission trip, any funds
given above and beyond what is needed for that individual will be used as the church deems necessary to further its mission and purpose.
• Designated gifts for a fund or special project – Every reasonable effort will be made to use the designated gift for the purpose in which it was designated. However, if the fund or special project no longer exists, the Board and Pastoral Leadership will decide how to use the funds.
CONTRIBUTION STATEMENTS
The church will provide, at least annually to donors, a record of cash contributions received in accordance with rules and regulations required by the IRS. Non-monetary gifts will be acknowledged by letter as described above, in compliance with IRS rules and regulations.
YEAR OF CONTRIBUTION
The IRS provides clear guidelines with regard to the date of posting contributions, which we follow carefully. All contributions received or postmarked by December 31 will be included in that year’s contribution statement. If the contribution is received or postmarked after December 31, it will be included in the contribution statement of the year in which it is received/postmarked—regardless of the date on the check.
CONCLUSION
The church respects the donor’s decision to give as led by the Lord. The above policies are meant to provide guidance to the donor and the church body as well as comply with the applicable tax laws. The church reserves the right to refuse contributions that are not related to the primary purpose of the church, not in the best interest of the church, or those not qualified for tax purposes. The church also reserves the right to amend these policies at any time. Please call the Church office at (803) 329-2163 for clarification or questions.