Are You Contributing To Your Identity Theft?
By Raul Rivera
Key point: Every time you give a church your personal information, such as name, address, and Social Security number, you may be contributiong to your own identity theft. Starting a separate 501(c)(3) ministry may help you avoid identity theft.
Landing at Miami International Airport on a Saturday afternoon after visiting my father’s orphanage in Venezuela, I zipped across the state of Florida to preach at a church in Glades County. The very small building was filled beyond its legal capacity that night as eager congregation members awaited the start of the service. Having never spoken at this church before, I felt warmly greeted by the pastor upon my arrival. He offered to give me a tour of the building facility, during which time I made several mental observations about the church’s administrative offices. During the tour, the pastor informed me that at the end of service the congregation would be granted an opportunity to give a special love offering to me. Though I tried to convey that it was not necessary, he insisted that I receive it. After gathering for prayer, the service started with praise and worship, followed by some announcements, special music, an offering, and then the preaching. By the time I stood to share the message, we were an hour and fifteen minutes into the service.
Because the service started at 8:00 p.m., I was feeling that the congregation would not be able to process a long message. Therefore, I preached a 20-minute message on the joy of the Lord and closed with an altar call. An hour and a half later we were still closing the service. The pastor finally ended it by taking up a 2nd love offering. A small basket was passed around.
By now it was after 11:00 p.m., and I was ready to get home. As I walked to my car, the pastor handed me a swollen #10 envelope and thanked me for the impartation I had made into his church. Though the opportunity to minister to the lives of the people in that church had eternal value and I was also being monetarily compensated for it, I came away from that experience with far more than a swollen #10 envelope. I came away with some observations that helped me to better formulate in my own mind/heart the significance of good church policies and procedures. Here is what I mean.
1. The church had no administrative offices: Many churches focus on a great sanctuary with extra space for youth and children. However, the administrative offices are an “oh, by the way” thought. When pastors look for a building to house their church I always consult them to give administrative office space equal weight to the sanctuary space. Think of it this way; when your church grows, you will likely spend 40 to 50 hours in the administrative offices while only 5 to 10 in the sanctuary. What many churches do not consider is how the productivity of administration affects the worship services.
2. The church had no filing cabinets: When I saw that the church did not have a single filing cabinet, my first thought was, “What will they do with my W-9 form?” As a guest speaker, I wanted to know that the personal information I was going to surrender to the church would be safely kept. It is an unfortunate thing today that many churches cannot safely keep something as simple as a W-9 form.
3. The church did not ask me to fill out a W-9 form: My worries soon changed when neither the pastor nor the treasurer asked me for a W-9 form. When I asked the treasurer if he wanted my W-9 form, his response was, “Huh?” At least for now, my Social Security number and address would be safe, but how was I to accurately report the love offering on my tax return? That brings us to item four below.
4. The love offering that I received was all cash: There are many churches today that give their guest speakers honorariums in cash without any records being kept. While such transactions are outside of the law, they occur quite often in churches. My dilemma was, how could I receive a cash offering from a church in a way that would not raise red flags on my tax return or for the church? The solution to this dilemma is a little lengthy and I share it at our conferences, from schedule C to the all-important special attachment to the tax return. It is the best way to cover yourself if you receive a cash love offering, while not creating additional exposure to the church that gave you the offering.
You might be contributing to your own identity theft
Have you ever thought about how a church handles your private and sensitive information? Churches are required to handle W-4 forms, W-9 forms, and other documents that contain personal information. Many preachers that travel often fill out W-9 forms and turn them in. They usually do not consider how the church will use the information and how they will keep it safe. Here some questions to ask.
1. Will the information be entered into an accounting system?
2. If so, are there policies in place to ensure unauthorized personnel will not access my personal information?
3. How and where will the physical W-9 form be stored?
Incorporating your own ministry
If they cannot answer those questions to your satisfaction, there is an additional strategy that you could implement. Consider incorporating your own independent preaching ministry. By doing this you avoid having to surrender your personal Social Security number. The new ministry will get its own tax-id number and then its own separate 501(c)(3) status. When you fill out a W-9, you now fill it out using your own ministry’s name and tax-id. It is a great solution to a potentially delicate problem. If you guest speak more than three times a year and plan on increasing that, you should strongly consider forming your own ministry. Feel free to talk to one of our consultants and get familiar with the options that are available to you. If you have not recently attended one of our conferences, be sure to also check out our schedule to see which conference would work best for you to attend. You will come away with far more than you thought possible!