Essential Steps to Begin 2024

By Mariel Villarreal

Establishing a solid legal foundation is crucial for every church, as it provides the necessary support and protection for the resources and responsibilities entrusted to them by God. As we step into 2024, this guide will help you fortify your church's legal standing, ensuring a strong year ahead.

1. Review the Board Minutes

Maintaining accurate board meeting minutes is essential for your church's compliance and legal standing. These documents serve as official records, demonstrating that your church operates within the bounds of the law.

Ensure detailed minutes exist for all your church board meetings from the previous year. Verify their accuracy, confirming that they faithfully capture the proceedings. Each set of minutes must be reviewed and approved at subsequent board meetings.

If any minutes are missing or if your church doesn't have records, your board can consider the concept of ratification of prior acts. This approach allows the board to approve decisions made in the past year retroactively. While this is a temporary solution, it's vital to document previous corporate decisions accurately. When applying this retroactive approval process, provide your best estimates of dates and times for these decisions.

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2. Additions and Removals of Board Members

The annual board meeting serves as a strategic occasion to recalibrate your board of directors. According to your organization's bylaws, this meeting offers the opportunity to handle various matters, including accepting resignations, welcoming new members, and, if necessary, removing existing board members. It's a chance to ensure your board comprises dedicated individuals aligned with your mission, working harmoniously to achieve common goals. This process guarantees that your board remains dynamic and effective, paving the way for a fruitful year.

Do you require guidance on navigating the next steps or achieving balance within your board of directors? Count on us for expert assistance!

3. Review Compensation Agreements

The start of a new year provides an excellent opportunity to review, restructure, and reapprove all compensation agreements. This evaluation is especially crucial if this is the first year of compensation for you or another staff member at your church. It is essential to determine the employment category of the individual – whether they are a ministerial employee or a regular employee. Approval for each individual's compensation must be obtained before disbursement.

Typically, this approval is granted through a comprehensive compensation package approved by the board of directors. Should you require guidance or have questions about these compensation arrangements, please feel free to reach out to us at 770-638-3444.

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4. Manage Donations with Exceptional Stewardship

Understanding the distinctions between restricted and designated offerings, as well as knowing the correct procedures for managing noncash donations like vehicles, is vital. Additionally, having a structured process for counting tithes and offerings is crucial. Addressing these aspects demonstrates good stewardship, ensuring church compliance and enabling donors to claim tax deductions for their contributions.

The IRS offers valuable resources, such as The Charitable Contributions Publication 1771, outlining the obligations of both charities and donors regarding various donations. Utilizing dedicated software to track and manage your church's donations is advisable. If you don't have such a system, consider exploring our cloud-based solution, Giving Halo.

5. Start Setting Aside Funds

Regardless of your church's financial status, making gradual savings is a prudent investment in your ministry's future. By consistently setting aside funds, your church will accumulate a significant amount in its savings account over time.

As Proverbs 13:11 (ESV) says, “Wealth gained hastily will dwindle, but whoever gathers little by little will increase it.”

6. Outsource Your  Bookkeeping

Consider hiring an outsourced bookkeeper for any organization, whether a nonprofit, church, or ministry. A bookkeeper's role involves maintaining detailed financial records, including income and expenses, transaction dates and amounts, tax planning, financial planning, and consulting services. They oversee all accounts and ensure the accuracy of accounting procedures.

Having the right team member onboard can relieve the burden, allowing you to concentrate on your ministry. Outsourcing your bookkeeping ensures accountability and legal compliance and offers numerous benefits.

Consider lightening your workload and enhancing financial efficiency by outsourcing your bookkeeping needs. With expert support, you can focus more on your ministry's mission. Ready to make the change? Contact us today for reliable and professional bookkeeping services tailored to your organization's needs.

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7. Establish a Business Owned by the Church

Life is too brief to cling to traditional approaches. God presents 'new wineskins,' unique opportunities for you and your church. So why not step into innovation by initiating and managing a church-owned business, breaking free from conventional methods?

Imagine your church owning a for-profit business and receiving from it tax-free dividends. We call it a “For Profit Arm.” In Section 502, the IRS calls it a “Feeder Corporation,” and describes it as a business operated for the primary purpose of carrying on a trade or business for profit even if the profits are distributed to your church tax-free. Your for profit arm can venture into diverse domains. Whether it's a retail outlet, a restaurant, a car dealership, real estate investments, or any other legal enterprise, your church can own and operate it. Seize the chance to redefine your ministry's path and create a lasting impact!

Exciting things await in 2024!

In pursuing God's purpose for our ministries, continuous dreaming, planning, and working towards more significant goals through Him is essential. Strengthening your church's administration can significantly ease your role as a minister. If you're ready to take the next steps or wish to explore ways to strengthen your church's foundation, please reach out to us at 770-638-3444! We're here to support your vision in the upcoming year.

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