Church, Inc.
By Pastor Ovid Need
Reprinted by permission
Foreword
At the onset, we must point out that this booklet is in no way meant to imply any kind of legal advice. It is strictly a Scriptural view of what is involved in the church-state marriage through the incorporation of a local body of believers, a local church. Laws vary from state to state, but the law of being under state control will not vary. Any steps which might be considered to remove a church or ministry from under the state's authority and place it under God's authority should to be compared with local laws concerning the corporation. This we did when we sought advice and help from Attorney Al Cunningham (Rt. 2, Box 33a, Big Bend Road, Montgomery Creek, Ca. 96065).
We also need to make a few more points:
First, the purpose of this booklet is to examine the Word of God and consider the Scriptural danger of a church or ministry placing itself under the authority of the state.
Second, this booklet is not meant to point an accusing finger at the state. Our God told us that the state would control any area in which the Christian refuses to glorify God as God (1 Samuel 8; Rom 1:21). Therefore, any infringement by the state into the church is because of sin in God's people. If God cannot control us by His Law-Word, then He will raise up an ungodly state to take the authority which God's people refuse to give Him.
Third, this booklet is not intended to deal with federal involvements or relationships, e.g. tax-exempt status.
Fourth, in Indiana, the corporation is created, owned, controlled and protected by the state at the body's request. The corporation must then have trustees to protect the state's property, and the pastor is an employee of its trustees. We assume this policy is typical of any state. (We will use "state" to refer to all civil government--local, state or federal.) We have reproduced copies of all the documents referred to in this little booklet.
Does Caesar have the authority over the Lord and His kingdom on earth? The historic conflict has been the church's refusal to recognize any such authority of the civil government over the body of Christ. Christ alone is the head of His church; only an unincorporated church can take a consistent stand that the state has no authority over the body of Christ, viz. the Church of the Lord Jesus Christ.
Introduction
Newly arriving at the Linden New Testament Baptist Church in 1983, the church had the annual Corporation Report waiting for me to fill out and file. This being my first experience with such matters, I read the form before filling it out. Alarmed, I called the men of the church together. I read the form to them. They were shocked, readily seeing that the church could not comply with the state's requirements as listed on the form. It was evident that up to this point someone had simply filled in a minimal amount of required information, mostly with Not Applicable, then filed the form and the $10 fee without examining it. (I would strongly suggest to anyone reading this booklet: read the forms your church fills out for the state! You could be in for a shocking surprise.)
In the past, incorporated "religious organizations" were probably separate under state laws. At that time, the laws may have presented no theological problems. But as time passed, the "religious organizations" were united with other corporations. Now we do have a theological problem.
We looked at the form, and because I didn't really know what was involved Scripturally, I handed it to a man and said, "Here, pretend I didn't see this and file it as has been done in the past." He put N.A. on everything; enclosed $10, and the state accepted it.
Because it took me by "surprise" and not knowing Scripturally what to do, I procrastinated on doing anything. The next time the form was due, we tried to file it again with N.A., but the state would not accept it. Therefore, we put in a minimal amount which the state accepted. Presently, the state apparently accepts, among other things, the total income and outgo of an incorporated "religious organization," but how much longer will it be accepted without, among other things, an itemized list of givers?
Then S.S. Form 8274 came along. This undoubtedly was one of the most wicked, ungodly forms any church has ever been asked to sign. If filed voluntarily, it opened all records to government inspection at their convenience. Even the lawyers (Gibbs and Craze) with whom I spoke could not say definitely what could be required if 8274 was submitted: "We won't know until it is litigated."
We knew we could not sign 8274, but if we remained a corporation, we had no choice but to do as the I.R.S. or any civil authority requested. The corporation placed us under their authority and answerable to their desires. The corporation is a child of the state; therefore, it must obey its parent.
We voted the church out of the corporation the night before the deadline for filing Form 8274. We renamed the church, Linden Baptist Church, and took all necessary steps to break with the corporation. Since unincorporating the Church, some things happened to confirm the Lord's direction in the matter:
1. In the summer of 1985, I gave the opening prayer at the meeting of the Tipmont R.E.M.C. members. Before the meeting opened, I was seated next to a board member of Wabash Valley Power, Assn. Inc. He said the reason WVPA had to file bankruptcy was because the Federal Government agency which guaranteed the loan to help with the Marble Hill Nuclear Power Plant that failed was now suing individual board members for the millions of dollars the corporation owed the agency. Since the corporation could not protect their personal property from government confiscation, the corporation had to file bankruptcy for protection.
2. One of our church men had a school friend who became a lawyer. He went on to practice as a trial lawyer in Alaska for eight years. Because of the pressure to compromise, he felt he could not "remain a Christian" and do what was required of him as a lawyer, so he discontinued his practice, returning to our area.
Speaking with him, I brought up the subject of incorporation. I pointed out that though many pastors view incorporation as simply notifying the state of their intention to operate and carry out the great commission, I felt it sought the state's permission to carry out our Lord's command.
He was emphatic: incorporation seeks the state's permission to operate and carry out its purpose as stated on the form requesting incorporation.
Thus it is immaterial how incorporation came about or the reasons for incorporating "religious ministries," the obvious fact remains which must be willfully ignored: today it is a request to the civil authority to operate for the stated purpose of the corporation.
Finally, I understand that lawyers know how useless the corporation is for what it promises, viz. protection. I have heard that they operate on the principle that someone wanting to start a business needs to incorporate. They offer corporate protection, but more importantly for the lawyers, fees are involved to set up the corporation and for every change the corporation desires to make. I also understand that lawyers know the ease of piercing the corporate veil.
The corporation is being passed off as protection by the state, yet it offers very little, if any, protection. It appears to be more for state control and money than for protection.
The following information is what the Lord used to force us to make our difficult decision. It is presented with a prayer that God will use it to reveal the dangerous, wicked connection of the state-owned and controlled "church." The church or ministry, whether a missionary organization or otherwise, with "Inc." in its name is obviously little more than a state-owned and controlled "person" under the law and under God. Is it thus possible for a state-owned and controlled "Religious Organization" to be a ministry under the authority of the Lord Jesus Christ?
A Personal Word
Because of the difficult time this pastor had and has addressing this and other issues, he realizes that pastors cannot make such major moves as dealt with herein without clear direction in the soul from the Lord. Therefore, the following is presented with a prayer that the reader will at least consider and then pray about the "principles" discussed.
We will open with a look at the practical implications of any ministry operating under the name of "God" being incorporated. Then we will proceed to address the Biblical precepts involved in incorporating a ministry.
Chapter I
Secular Reasoning
Like most men, when I first became involved in the Conservative Christian Movement in the mid-60s', I knew nothing about incorporation. Of course, there was no issue back then. While an associate pastor of a church in the deep south in 1977, we became involved in a dispute with the state over its desire for us to take a license for the church nursery. But incorporation was not an issue. (The church was incorporated; therefore, it probably would have lost in court.)
Soon after we moved to Indiana, we attended a 1984 legal seminar. The lawyers speaking (Gibbs and Craze) pointed out that whereas it was unheard of ten years ago, there are presently very few cases against churches where corporation is not an issue.
Most pastors and laymen have not had to face the issue of incorporation. Or if they have, they, like myself, have chosen to ignore it. The issue of incorporation has not yet developed to its logical conclusion. The state is not yet demanding the detailed completion of the annual form, nor is it pressing the implications of incorporation. But how long will it be before "religious ministries" will be required to line up with public policy? (I understand that Public Policy is being enforced against churches in some states.) The incorporated ministry does not have a leg to stand on against its parent-owner's, i.e. the state's, demands.
The issue is no doubt being ignored by many because they do not want to disturb the waters or "rock the boat," or they may be afraid of the cost involved. The civil authorities are not pressing the implication at this time, so "we" are able to carry on "business as usual." But God knows the issue, and He will rock the boat and force churches and ministries to choose who is their god. Even though I had a man file the annual not-for-profit corporate report with minimal information, I knew we could not give the state what they required; however, I realized we would eventually have no choice if we kept the corporation.
State financial reports
As we talk to pastors, some agree that they cannot submit the state's required information. But does not giving the required information make the church dishonest? Other pastors express willingness to provide the state with its required financial information concerning the churches God has placed them over: the completed forms appease the state, so they can "serve the Lord." Any spirit of willingness to open the church for state inspection is detested by God.