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Five Ways Designated Giving Can Get Your Chapel in Trouble

Specified giving can be an incredible blessing for your cathedral. It allows, for instance , church members to give to such regions of passion as missions or facilities. But far too many churches are usually handling designated giving in ways that can have them in trouble. That difficulty can range from comfort problems among people and staff in order to losing your non-profit status with the Internal Revenue Service.

I’ve got many conversations along with church leaders concerning this issue. Designated offering questions are common at Church Answers. Through the years I have seen 5 ways designated giving can get churches in trouble.

1 . Recognizing a designated present that personally advantages the donor. Listed below are two real examples from the past couple of years. In one church, the members would “donate” to the mission account and then get their objective trip paid simply by that same amount. That is a big no-no from the IRS, and really should be an honest problem for the cathedral. In another example, the pastor questioned me if a member could donate scholarship or grant funds that would consequently be used to pay the particular member’s daughter’s college tuition. No!

2 . Accepting a designated gift for a favored ministry of the cathedral by a member who had been not happy with the church’s budget. Indeed, I understand personally of a situation where the worship innovator encouraged some users to designate all of their gifts to their ministry, a ministry he felt had been underfunded. While this practice is not necessarily unlawful, the church is definitely under no obligation to accept this workaround giving.

several. Accepting a specified gift for any good cause. Churches must not be a tax-deductible conduit for any and every result in. If someone really wants to donate money, for instance , to fund underprivileged kids in the community, point that person to find another non-profit agency whose objective aligns with the giver’s desires. There are many good causes, but the cathedral is not a channel to distribute money outside of its purpose and mission.

4. Accepting the designated gift for your building program with specific conditions with regard to how the funds is going to be used. It is excellent that the church has a building fund. Yet church members should not have the prerogative to express how their funds will be used in home. One church associate, whose gift to the building fund was ultimately rejected, experienced demanded that her funds be used especially for a certain type of stain-glassed windows.

5. Accepting a designated gift that is a type of blackmail. “If you don’t use these funds for this purpose, i quickly am withholding all of my funds for the church. ” In case someone makes this type of demand, let them stroll. You may worry about your budget for the short term, however, you will have fewer issues in the future. The cathedral should never yield to someone who tries to keep the church financially hostage.

I recommend for all church leaders to establish funds where they are willing to accept designated giving. Any presents that fall beyond those funds ought to be politely declined. Not all church members which give designated money do so with nefarious intent. They will most likely accept your description that the church’s economic structure is established to simply accept only designated gifts in pre-approved funds.

If they respond negatively, you likely a new problem on your fingers anyway.

Stay out of trouble in designated giving. It’s not worth the money you might eliminate.

 

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