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  • How to Protect the Legal Assets of My Church

    Church leaders in Virginia need to be aware of the legal protections available to them and their organizations. By taking proactive steps to protect your church’s assets, you can safeguard your congregation’s livelihood in the event of a legal dispute. This article will discuss some key measures that you can take to protect your church’s legal interests.

    Select the Right Entity

    As a church leader, you have a lot of important decisions to make. One of the most important decisions you’ll make is choosing the right business entity for your church. The entity you choose will have a significant impact on your church’s ability to raise funds, protect its assets, and reduce its exposure to liability.

    A Corporation Gives Your Church the Ability to Raise Funds

    One of the key benefits of incorporating your church is that it gives you the ability to raise funds. When you incorporate, you can apply for 501(c)(3) status with the Internal Revenue Service (IRS). This status will exempt your church from paying federal income taxes and allow donors to deduct their contributions on their own taxes. In order to apply for 501(c)(3) status, you will need to submit an application and supporting documentation to the IRS.

    A Corporation Reduces Your Church’s Exposure to Liability

    Another key benefit of incorporating your church is that it helps protect your church’s assets. When you incorporate, your church will be considered a separate legal entity from its members. Incorporated churches are not required to disclose their financial information to the general public. This can help protect your church from thieves and fraudsters who may target unincorporated churches.

    Use Governing Documents

    Governing documents are important for churches because they provide a clear framework for how the church should be run. Without these documents, there would be no way to hold church leaders accountable for their actions. Additionally, governing documents can help protect your church’s assets from being misused or misappropriated.

    Governing documents are documents that set forth the rules and regulations for how a church is to be run. They can include things like the church’s bylaws, Articles of Incorporation, and other similar documents. Having these documents in place helps to ensure that the church is run in a legal and orderly fashion and that its assets are protected.

    One of the fundamental ways that governing documents protect your church’s assets is by specifying how the church’s property is to be used. For example, if your church owns a piece of property, the governing documents may specify that it can only be used for religious purposes. This helps to prevent the property from being sold or used for other purposes without the approval of the church leaders.

    Another way that governing documents protect your church’s assets is by specifying who has authority to make decisions about the use of those assets. For example, the bylaws of a church may specify that only the board of trustees has the authority to sell or transfer ownership of church property. This helps to prevent unauthorized individuals from making decisions about the use of church assets.

    Keep Accurate Records

    Churches are required to keep certain records in order to maintain their entity status. The most important of these records are the Articles of Incorporation, the Bylaws, and the Meeting Minutes.

    The Articles of Incorporation are the legal document that establishes the church as a non-profit corporation. They must be filed with the state and should be kept in a safe place where they can be easily accessed. The Articles should be reviewed and updated as needed, but at a minimum, they should be reviewed every five years.

    The bylaws are the governing document for the church. They should outline the church’s purpose, how decisions will be made, and who is responsible for what actions. The bylaws should be reviewed and updated as needed, but at a minimum, they should be reviewed every five years.

    Minutes should be taken at all formal meetings of the church, including Board meetings and congregational meetings. They should be kept in a safe place where they can be easily accessed. Meeting minutes do not need to be updated as frequently as the Articles of Incorporation or bylaws, but they should be reviewed periodically to make sure that they accurately reflect what happened at the meeting.

    Enact Effective Policies

    The first step in creating an effective policy is to identify the need for the policy. What problem are you trying to solve? Once you have identified the problem, you can start crafting a policy that will address it. The policy should be clear, concise, and easy to understand. You will also want to make sure it is enforceable and that you have the resources in place to enforce it.

    For a church asset protection policy, consider the asset you are trying to protect. Your first step should be to create an asset protection policy. This policy should list the church’s assets and how they should be protected. For example, if the church has valuable paintings, you may want to include a rule that they must be hung behind bulletproof glass. You should also include a rule that all doors and windows must be locked when the church is not in use.

    Enforcing the policy is just as important as creating it. You will need to make sure everyone in your church is aware of the policy and knows how to comply with it. You will also need to have a system in place for dealing with violations. Church leaders who take the time to create and enforce effective policies can help keep their assets safe and secure.

    Once you have created your asset protection policy, it is important that you enforce it. Make sure that all church staff and volunteers are aware of the policy and know how to comply with it. Hold regular meetings to remind everyone of the importance of following the policy.

    Keep Employment Law in Mind

    Even as a church, you will need to be aware of employment laws, if you plan on hiring staff. Here are three key employment laws you need to consider.

    The Equal Employment Opportunity Commission (EEOC)

    The EEOC is a federal agency that enforces anti-discrimination laws in the workplace. This includes laws that protect employees from being discriminated against based on their race, color, religion, sex, national origin, disability, or age.

    If your church has 15 or more employees, you are required to post an EEOC notice in a conspicuous place where all employees can see it. You should also include the notice in any employee handbooks or manuals. 

    The Family and Medical Leave Act (FMLA)

    The FMLA entitles eligible employees of covered employers to take unpaid, job-protected leave for certain family and medical reasons. Under the FMLA, church leaders must provide 12 weeks of unpaid leave for eligible employees who have a new child, are caring for a sick family member, or need time to recover from their own serious health condition.

    To be eligible for FMLA leave, an employee must have worked for their church for at least 12 months and have 1,250 hours of service during that time period.

    Workers’ Compensation Insurance                

    If your church employs five or more full-time workers or part-time workers who work a combined total of at least 30 hours per week, you are required to carry workers’ compensation insurance. This insurance provides benefits to employees who are injured or become ill as a result of their job duties.                   

    In Virginia, there are three ways churches can comply with the workers’ compensation insurance requirement: 

    • Purchase an insurance policy from a private insurer 

    • Join a state-sponsored program 

    • Self-insure 

    The Virginia Beach Church Lawyers at Anchor Legal Group, PLLC, Help You Protect the Assets of Your Church

    If you need a legal advocate on your side to help protect your church’s assets, speak with our experienced Virginia Beach church lawyers at Anchor Legal Group, PLLC. Contact us today at 757-LAW-0000 or fill out our online form to schedule your free consultation with our legal team. With offices in Virginia Beach, Virginia, we proudly serve Virginia Beach, Chesapeake, Norfolk, Suffolk, Portsmouth, Newport News, Hampton, and Eastern Shore.