Yes, Ministries Should Embrace AI

AI is a tool that, if used properly, can advance ministry.

There is no doubt that artificial intelligence (AI) has been a significant technological advancement and will continue to revolutionize our lives, with some suggesting AI is to this generation what dial-up internet was to the prior generation. 

But with artificial intelligence comes many questions.

Is it safe?

Can it be trusted? 

And will AI lead to the destruction of life on our planet?

In many ways, our sci-fi imaginations get the better of us: Is AI the Terminator come to life? Have we finally built Mr. Data from Star Trek: The Next Generation? When can I order my first C-3PO droid from Amazon?


Plug in and listen to Church Lawyer Erika Cole tackle how AI intersects with the church.


Think critically about AI

But the more constructive question for church leaders is this: How will AI affect churches and ministries? 

One thing to remember: Artificial has been around for a while and has been used in the form of algorithms to process data and determine outcomes. Algorithms determine our social media feeds, protect our bank accounts and personal information, and even help with traffic management.  

As the algorithms get “smarter,” the appearance of intelligence emerges. Add to that the ability to tackle more complex, subjective questions, such as “Which national park is the best?” and the algorithms behind AI begin to give it the appearance of discernment.

But AI can’t discern. Remember, the data from which it draws its conclusions was provided by humans that may not always agree and are often filled with biases. So, while artificial intelligence does its best with what it has, we’ve found it to be extremely flawed.

You remember the adage, Garbage in equals garbage out? It’s still true. But with AI, the scale makes finding the garbage a challenge, and the subjective nature of what one human programmer views as garbage compared to another programmer’s view further complicates the effectiveness.

It harkens to the early days of the internet when we emphasized that not everything you read online is true. 

Now, the emphasis is on reminding people that, not only is the internet not the ultimate source of truth, but neither is social media—and neither is AI.

Embrace AI, do not fear it

How does all of this affect ministries? 

First, there is no need to be scared. Artificial intelligence is not life—only God can create life. No amount of programming or algorithms can change that. AI can only mimic the creative process.

Second, you can’t always trust it.   Phishing scams and get-rich-quick schemes flourish because we believe what we see online. You don’t know if there is another human trying to scam you or another human using AI to make the scam more complex, but you can’t naively trust AI. 

Third, ministries should embrace AI.  (Yes, you read that correctly.)

Churches and ministries should not run and hide just because AI poses risks. Instead, they should use AI, as they hopefully use other technology, for ministry effectiveness.

Convene conversations around AI

AI offers numerous ministry opportunities. Instead of fearing it, use it as a discipleship opportunity.

Sure, your theology will come into play when evaluating artificial intelligence, but is your church teaching about it with any theological depth? 


Does all this talk of gen AI have you thinking about other IT-related issues? Consider picking up a copy of Nick Nicholaou’s “Church IT.


Have you considered community events to teach the good and the bad? What about teaching basic online safety, including code words to avoid child voice scamming, or that using AI—or any other method—to cheat on one’s homework is a sin?

I assure you: I typed what you are reading here. But how do you know? How would a school know? Even AI tools used to detect AI-created content had to be shut down because the tools failed more than 60 percent of the time.

In many cases, AI should be an opportunity for the church to look deeper at itself, both beneath the steeple and outside the walls.

AI’s undeniable power

Meanwhile, the power of AI is undeniable and creates questions and concerns.

Its ability to generate lifelike videos is amazing. 

The benefits to church production in not having to record your pastor literally saying every word, but rather, setting up an AI version so you can improve efficiency is incredible.

The sin-cursed side of this is, what happens when the pastor leaves and the church holds on to the likeness and makes it say things the pastor would never say? This side of heaven, powerful technology must be applied through the lens of the Bible.

At a more individual level, what happens when artificial intelligence is used to fake the voice of one of your children calling for help when your child is safe? Social media is another powerful technology that can be used for good and evil. The video you posted of your child giving a speech can also be used to get a sample of a child’s voice that, in turn, could be used to scam you through emotional distress. 

The world is constantly changing. We need to teach that the Bible is forever, providing a strong theological foundation so that, whatever comes next, our people are ready to handle it in a Godly manner. None of these technological developments surprised God, but do we really believe and teach that? The Bible teaches the need to discern right from wrong, and yet we are not teaching that same discernment online.

Using AI to strengthen ministry

Other benefits for churches involve data collection and analytics. I’ve written about the data that churches collect and how to keep it safe, but what about using AI to better evaluate that data? Data is fine, but it’s what you do with the data that really matters.

Artificial intelligence can be an ally in this effort by going through data and providing useful information from which to make decisions.

Using AI to help close the proverbial “ministry back door”where people stop attending before leaders realize it. AI can help us better evaluate attendance patterns and changes in involvement, even comparing attendance with giving trends. This information might help us understand who is at risk for leaving the church or struggling in a manner that a call or visit might prove fruitful. What used to be complex and take hours can now be simplified and assessed in real time. 

Copyright and defamation concerns

We have a long way to go to catch up with the advancements artificial intelligence has provided and the law lags these advancements, too. AI has quickly outdated copyright laws. Personal privacy and intellectual property lawsuits are just starting to head to court. Defamation cases are being filed. But in these cases, who’s to blame? The AI? Or those who programmed the AI? The decisions to come will reshape how we know and understand the use of this technology even in church contexts.

Stewarding AI for good

I’m excited about AI’s potential for affecting the Kingdom. 

But, whether with AI, social media, digital projectors, microphones, cameras, or anything else, all new technology requires responsible use. 

Microphones are great, but if you don’t know what you are doing, they will cause piercing feedback. artificial intelligence is also great, but if you don’t know what you are doing, and you aren’t willing to learn, the scale of the feedback could be destructive. 

Jonathan Smith is director of technology for Faith Ministries in Lafayette, Indiana. He is also president of MBS, Inc., a provider of technology services that exclusively serves churches and ministries. He is a published author and a frequent speaker at conferences.

Key Tax Dates September 2023

Key tax dates for September 2023 include quarterly estimated payments and monthly or semiweekly requirements.

Monthly requirements

If your church or organization reported withheld taxes of $50,000 or less during the most recent lookback period (for 2023, the lookback period is July 1, 2021, through June 30, 2022), then withheld payroll taxes are deposited monthly. Monthly deposits are due by the 15th day of the following month.

Note, however, that if withheld taxes are less than $2,500 at the end of any calendar quarter (March 31, June 30, September 30, or December 31), the church need not deposit the taxes.

Instead, it can pay the total withheld taxes directly to the IRS with its quarterly Form 941. Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes, and the employer’s share of Social Security and Medicare taxes.

Semiweekly requirements

If your church or organization reported withheld taxes of more than $50,000 during the most recent lookback period (for 2023, the lookback period is July 1, 2021, through June 30, 2022), then the withheld payroll taxes are deposited semiweekly.

This means that for paydays falling on Wednesday, Thursday, or Friday, the payroll taxes must be deposited on or by the following Wednesday. For all other paydays, the payroll taxes must be deposited on the Friday following the payday.

Also note that large employers having withheld taxes of $100,000 or more at the end of any day must deposit the taxes by the next banking day.

The deposit days are based on the timing of the employer’s payroll.

Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes, and the employer’s share of Social Security and Medicare taxes.

September 15, 2023: Quarterly estimated tax payments for certain employees and churches

Filing for certain ministers and self-employed workers

Ministers (who have not elected voluntary withholding) and self-employed workers must file their third quarterly estimated federal tax payment for 2023 by this date. A similar rule applies in many states to payments of estimated state taxes.

Nonminister employees of churches that filed a timely Form 8274 (waiving the church’s obligation to withhold and pay FICA taxes) are treated as self-employed for Social Security, and as a result are subject to the estimated tax deadlines with respect to their self-employment (Social Security) taxes unless they ask their employing church to withhold an additional amount of income taxes from each paycheck that will be sufficient to cover self-employment taxes. Use a new Form W-4 to make this request (the additional withholding is reported on line 4(c)).

Payments for unrelated business income tax liability

A church must make quarterly estimated tax payments if it expects an unrelated business income tax liability for the year to be $500 or more. Use IRS Form 990-W to figure your estimated taxes. Quarterly estimated tax payments of one-fourth of the total tax liability are due by April 18 (April 19 if you live in Maine or Massachusetts), June 15, September 15, and December 15, 2023, for churches on a calendar-year basis. Deposit quarterly tax payments electronically using the Electronic Federal Tax Payment System (EFTPS).

Note: If a date listed for filing a return or making a tax payment falls on a Saturday, Sunday, or legal holiday (either national or statewide in a state where the return is required to be filed), the return or tax payment is due on the following business day.

Note: You must use electronic funds transfer to make all federal employment tax deposits. This is generally done using the Electronic Federal Tax Payment System, a free service provided by the US Department of Treasury. If you don’t wish to use EFTPS, you can arrange for your tax professional, financial institution, or payroll service to make deposits on your behalf. Failure to make a timely deposit may subject you to a 10-percent penalty.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

How Churches Can Leverage Higher Interest Rates

Higher interest rates offer churches an opportunity to adopt new cash- and debt-management strategies.

In an era of higher interest rates, it is essential for churches to adopt new cash- and debt-management strategies. 

Seek an increase in savings, money market interest rates

A good first step for churches is to request an increase in the interest rate on their bank’s savings or money market accounts.

By negotiating better rates, churches can see higher yields in support of their mission. 

Beyond that, reassessing cash management strategies is key when interest rates are high.

Get strategic about cashflow

One effective approach is to redirect cash held in an operating account to savings or money market accounts.

Try to place all cash not needed to pay bills in the next 14-30 days into accounts that gain a higher interest rate. Strategically managing cash flow means a church can strike a balance between accessible funds for day-to-day expenses and maximizing the interest earned on their reserves.


Pick up a copy of “Church Finance: The Church Leader’s Guide to Financial Operations,” today at the Church Law & Tax store.


Beef up reserves

Churches looking to build up reserves for future projects should consider investing in bonds or bond mutual funds.

The Federal Deposit Insurance Corporation (FDIC) insures deposits of up to $250,000 per depositor, per insured bank.

If the church leaves its cash reserves in one bank, though, it exposes them to risk without the benefit of a higher potential interest rate (banks do not typically pay high interest on cash savings). Instead, investing in bonds or bond mutual funds enables the church to possess investments with a low risk profile but higher returns than cash.  

Bonds typically offer higher interest rates compared to traditional savings accounts, making them attractive investment vehicles.

By carefully selecting bonds based on risk tolerance and investment objectives, churches can secure steady income streams and potentially grow their money to keep up with the rising cost of construction.

Before investing in bonds, be sure you have your board write an investment policy with the advice of a financial professional.

Higher interest rates and debt paydowns

Some churches enter swap agreements with financial institutions—contractual arrangements that typically exchange cash flow or liabilities from two different financial instruments.

For churches with existing swap agreements on their loans, higher interest rates may present an opportunity to pay down debt. Analyze the terms of the swap agreement and consider reducing the outstanding debt if it is advantageous.

In some cases, churches may find themselves in a favorable position, allowing them to receive payments from investors when paying down their debts.  

Again, though, be sure to seek professional advice before moving forward with such a strategy. 

A word of caution

Though higher interest rates may be advantageous for certain financial strategies, it is crucial for churches to exercise caution when taking on additional debt. Rather than focusing on increasing debt, it is advisable to undertake projects that align with the congregation’s regular patterns of giving. 

Capitalizing on higher interest rates will require some strategic thinking and execution. However, it is essential to remember that every church’s financial situation is unique, and professional advice is crucial for tailoring strategies to specific needs. 

Tim Samuel is a CPA and the chief financial officer of Bridgeway Community Church, a nondenominational, multicultural church in Columbia, Maryland, that draws more than 4,000 people each week.

Tackling Big-Ticket Repairs on a Housing Allowance

So, you’ve done the hard work of setting a housing allowance and, SURPRISE!, the septic tank fails. What now?

Q: Unplanned repairs are part of homeownership. What can a church do to help with a big-ticket repair that wasn’t anticipated when designating the pastor’s housing allowance?


Let’s assume we’re talking about an $8,000 septic tank replacement. Let’s say the church agrees to increase the housing allowance for the remainder of the year by $8,000. Either the church can designate an additional $8,000 out of the pastor’s salary as housing or the church can give the pastor the $8,000 and call it housing-related.

From a tax perspective, it’s unlikely either approach will actually help.

Why? To understand, it’s necessary to understand how the housing allowance works.

A calculation game

The amount a pastor is allowed by the Internal Revenue Service (IRS) to exclude from income tax as a housing allowance is the smaller of three separate numbers:

  1. The amount the church designates as a housing allowance;
  2. The actual amounts expended on housing during the year, including mortgage payments, property insurance, property tax, utilities, repairs and maintenance, and furnishings; and
  3. The annual fair rental value of the home, plus utilities, plus furnishings.

Returning to the example above, assume that, regardless of which way the $8,000 is handled, the church designated a total housing allowance for the year, including accounting for the septic tank, of $40,000.

Other assumptions

Let’s further assume that, at the end of the year, the pastor adds up all of his or her actual housing expenses and the total is $31,000, plus the $8,000 septic tank repair, for total actual housing expenses of $39,000.

Finally, the pastor consults with a local real estate agent and determines that the annual fair rental value of his or her home, including the effect of the new septic system, is $25,000. Add to this amount an additional $3,600 in utilities and $2,400 in furnishings, and the fair rental value, plus utilities, plus furnishings is $30,000. This amount is well below the actual expenditures (when the septic tank is factored in) and the designated housing allowance amount.

The moral of the story is that the fair rental value, plus utilities, plus furnishings is always going to be a hard cap in terms of how much a pastor can exclude from income tax. That’s because this calculation usually comes in as the lowest of the three figures that need to be calculated. As this example illustrates, designating an additional amount as the housing allowance had no impact on the amount the pastor could actually exclude from tax.

‘Better than a stick in the eye’

Here’s another common example: A pastor wants to add a second story to a home at a cost of $60,000. Let’s say this pastor is making $150,000 a year, of which $40,000 is designated as housing allowance. The pastor comes back to the church and asks the church to bump up that housing allowance from $40,000 to $100,000. That may help to a degree, because a two-story house is going to have a higher fair rental value than a one-story house.

But the pastor is not going to get the full benefit that he or she anticipated getting because the fair rental value calculation still will come in below $100,000.

So, does this mean a big ticket expense is not going to really benefit a pastor?


Upgrade to an Advantage Membership


As my dad would say, it’s better than a stick in the eye.

But the pastor ordinarily is not going to be made whole in the process from a tax benefit perspective. Subject to the general requirement that a church (or any nonprofit organization) not pay its key employees excessive compensation, the church can still provide more money to the pastor in response to the need. It just means the pastor will pay income tax on the added amount.

Also, in the above example, the church must also consider the reasonableness of the pastor’s overall compensation before providing more money.

Timing also matters

Remember a couple of additional things about how the housing allowance works.

  1. The housing allowance is always a prospective thing. The church must always award or pass a resolution to give a pastor a housing allowance on a prospective basis. It can never be applied retroactively.
  2. When changes to the allowance are needed mid-year, those changes also only take place going forward.

Something attorney and senior editor Richard Hammar deals with in the annual “Church and Clergy Tax Guide” is that we don’t have a lot of guidance from the IRS that explains whether a pastor has to have a match between the time he or she incurred expenses and the time he or she gets paid the allowance.

So, consult with a tax advisor.

Hypothetical scenario:

Let’s say a large church adds a new pastor midway through last year. Unfortunately, the church forgets to formally set the new pastor’s housing allowance for the first three months of the new year. In that scenario, the pastor has made several mortgage payments in the new year without the benefit of the allowance. So, the question becomes whether those mortgage payments are countable in the housing costs for the year. The answer? Consult your tax advisor.

Either way, the pastor should understand the mortgage payments may not be able to be claimed.

Again, that’s something the pastor and the pastor’s tax advisor must work out.

On the church’s side, I always tell the church, ‘Hey, you were going to give this (pastor) a $20,000 housing allowance and you didn’t do it in the first six semi-monthly pay periods of the year … let’s take that $20,000 and divide it into the remaining payrolls.’

By doing that, we’re giving the pastor the opportunity to decide, in consultation with a tax advisor, whether he or she wants to include those three months of housing expenses.

Q: Can a church declare 100 percent of a pastor’s compensation to be a housing allowance?

There is no legal impediment to do so, although it’s not advisable.

That’s because you’re relying on the pastor and his or her tax advisor to know the rules and exclude the proper amount. You’ve set them up to make a mistake.

In addition, if you offer benefits, such as health insurance for which the pastor must pay a portion, a healthcare flexible spending account, or a 403(b) plan with elective deferrals, the pastor must have cash salary, not housing allowance, from which to deduct these withholdings.

So, as a practical matter, declaring 100 percent of a pastor’s compensation to be a housing allowance would compromise participation in these benefit programs.

Ted R. Batson Jr. is a CPA and tax attorney, and serves as a partner and Professional Practice Leader – Tax for CapinCrouse LLP, a national CPA and consulting firm. He speaks and teaches frequently for national conferences and organizations on exempt organization and charitable giving matters.

Key Tax Dates August 2023

Key tax dates include filing Form 941, and meeting certain monthly or semiweekly filing requirements.

Monthly requirements

If your church or organization reported withheld taxes of $50,000 or less during the most recent lookback period (for 2023, the lookback period is July 1, 2021, through June 30, 2022), then withheld payroll taxes are deposited monthly. Monthly deposits are due by the 15th day of the following month.

Note, however, that if withheld taxes are less than $2,500 at the end of any calendar quarter (March 31, June 30, September 30, or December 31), the church or organization need not deposit the taxes.

Instead, it can pay the total withheld taxes directly to the IRS with its quarterly Form 941. Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes, and the employer’s share of Social Security and Medicare taxes.

Semiweekly requirements

If your church or organization reported withheld taxes of more than $50,000 during the most recent lookback period (for 2023, the lookback period is July 1, 2020, through June 30, 2021), then the withheld payroll taxes are deposited semiweekly.

Tip: Wondering if you’ve missed any key tax dates so far this year, visit our Tax Calendar to read (and download) each of our 2023 key tax date updates. all 2023 key tax dates.

This means that for paydays falling on Wednesday, Thursday, or Friday, the payroll taxes must be deposited on or by the following Wednesday. For all other paydays, the payroll taxes must be deposited on the Friday following the payday.

Note further that large employers having withheld taxes of $100,000 or more at the end of any day must deposit the taxes by the next banking day. The deposit days are based on the timing of the employer’s payroll. Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes, and the employer’s share of Social Security and Medicare taxes.

August 10, 2023: Employer’s quarterly federal tax return—Form 941

Churches having nonminister employees (or one or more ministers who report their federal income taxes as employees and who have elected voluntary withholding) may file their employer’s quarterly federal tax return (Form 941) by this date instead of July 31 if all taxes for the second calendar quarter have been deposited in full and on time.

Note: If a date listed for filing a return or making a tax payment falls on a Saturday, Sunday, or legal holiday (either national or statewide in a state where the return is required to be filed), the return or tax payment is due on the following business day.

Note: You must use electronic funds transfer to make all federal employment tax deposits. This is generally done using the Electronic Federal Tax Payment System, a free service provided by the US Department of Treasury. If you don’t wish to use EFTPS, you can arrange for your tax professional, financial institution, or payroll service to make deposits on your behalf. Failure to make a timely deposit may subject you to a 10-percent penalty.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

Crafting a Church Employee Discipline Process

An employee discipline process is a solid first step addressing performance-related issues.

Last Reviewed: February 3, 2025

Crafting and implementing an employee discipline process at your church is does not demonstrate poor confidence or some admission of anticipated failure. Rather, it is a way of building solid ground rules for when employee performance issues inevitably arise.

Every employer has the best of intentions when they hire someone, and employers always try to hire the most qualified individuals who will fit within the employer’s culture and immediately exceed expectations. Churches are no exception.

But the reality is some new employees do not perform—or fit in—as expected. Other employees miss the mark even years after their start dates.

Whether the “nirvana” of a new hire fades, a veteran employee begins repeatedly falling short, personality conflicts arise, or an outside factor—such as an arrest—surfaces, the employer must address poor performance or missed behavioral standards.

Here’s what to do when discipline is needed.

Employee discipline requires solid ground rules

A church should first clearly communicate the rules it intends to enforce against employees who fail to meet expectations.

The job description and employee handbook establish these expectations. The job description describes performance expectations of the position, while the employee handbook describes the behavioral rules applicable to all employees.

Caution. When the church communicates through job descriptions and an employee handbook, it must be careful not to unintentionally create a contractual obligation with employees.

The employee handbook should also contain the disciplinary rules applicable to all employees.

Employee discipline begins by addressing minor infractions and progresses to more serious ones.

A typical employee handbook provision might say:

Violation of church policies and rules might warrant disciplinary action. Forms of discipline that the church may elect include verbal corrections, written warnings, final written warnings, and/or suspensions and terminations. The system is not formal, and the church may, in its sole and absolute discretion, deviate from any written disciplinary policy and utilize appropriate forms of discipline under the circumstances, including immediate termination. The church’s disciplinary policy does not limit or alter the employee’s at-will status.

Disciplinary systems

While a progressive discipline system remains the most popular disciplinary system, smaller employers frequently favor a corrective disciplinary system.

In other words, the supervisor selects the type of discipline based on the facts and circumstances of the situation. While this system is more flexible than the progressive discipline system, churches must use extra caution to ensure that similarly situated employees get treated similarly.


Read more about how a religious school could be sued for unlawfully terminating the employment of an unmarried pregnant teacher after the court determined the school lacked a policy regarding sex outside marriage and failed to investigate past treatment of similarly situated employees accused of similar conduct.


The disciplinary system also should avoid certain words that require a church to act in a certain way.

When an employee fails to meet expected levels of performance or behavior, the church typically uses one of four types of discipline.

Verbal counseling. This method allows the supervisor to address the issue immediately with the employee. In every case, the supervisor should create a written memo or note for placement in the employee’s file. This documentation is critical. If it is not in the employee’s file, it is as if the issue never happened.

Written warning. The supervisor should meet with the employee and another employer representative to discuss the issue. The church should allow the employee to review the formal written warning. The written warning should have a place for the employee to sign, demonstrating that the employee received a copy. If the employee refuses to sign, the other employer representative should sign as a witness that the employee refused to sign the written warning.

A written warning should include, at a minimum: the date of the warning, the employee’s name, the name of the supervisor, a factual description of the misconduct or inadequate performance, the exact date of the misconduct or inadequate performance, the signature line for the employee, the signature line for the supervisor, and the signature line for the witness. 

As a separate document, the supervisor may attach an action plan for correcting the issue.

The action plan should include a statement of the policy or practice that was violated, the steps the employee agrees to take to correct the problem, any commitments the supervisor makes to assist the employee in achieving the correction, the timeframe for correcting the problem, and the consequences for failing to correct the problem within the set timeframe.

Suspension. If the suspension is the prelude to a subsequent termination, the supervisor should include a written warning and an action plan with the notice of suspension.

Termination. Before terminating an employee, senior management should review the entire personnel file of the employee. Under some limited circumstances, the church should immediately terminate the offending employee.

For example, if the employee exhibits violent behavior or drug or alcohol use while working, the employer should immediately terminate the employee. Termination should occur through an in-person meeting.

Senior management and the supervisor should be present. Senior management should request that the information technology team change all of the employee’s passwords and computer and network access during the meeting.

In the meeting, senior management should request the return of all the church’s property. Ideally, senior management should present the employee with his or her final paycheck during the meeting.

Selecting the right discipline

When selecting a course of disciplinary action, the supervisor should consider the facts and circumstances surrounding the need for discipline. The supervisor should evaluate both mitigating and aggravating factors.

Mitigating factors may include:

  • Long tenure
  • Long history of satisfactory performance
  • Prior commendations or awards
  • Any excuses offered by the employee

Aggravating factors could include:

  • Short tenure
  • History of unsatisfactory performance
  • Prior discipline
  • The degree to which the employee has responded with a denial of responsibility

The supervisor should check with senior management or the human resources department, if applicable, before disciplining an employee.

Senior management should review the employee’s prior disciplinary history, if applicable.

Employee discipline should be as consistent as possible for similar infractions. Senior management should search the church’s records to determine how it has addressed similar situations with other employees, past and present. 

Senior management should consider any harm associated with discharging or severely disciplining the employee for a particular offense.

They should also consider whether the employee is part of a protected class of employees and whether the employee might have a claim that the discipline is retaliation for protected activities, such as whistleblowing.

If any of these factors are present, senior management should consult with an attorney.

Releases

If the termination option is selected, the church should consider whether the release agreement is appropriate. A release is probably unnecessary if the employer has appropriately executed and documented the discipline. 

If severance pay is provided, the church should consider a release.


Frank Sommerville partnered with Church Law & Tax to develop a seven-part series dedicated to helping you navigate several employee issues that are unique to churches. Find them all here:

Frank Sommerville is both a CPA and attorney, and a longtime Editorial Advisor for Church Law & Tax.

Generative AI Is All the Rage. Handle With Care.

Generative AI is all the rage and church leaders may want to dive right in. But be cautious–there are a lot of unknowns.

Not long ago, few knew the term “generative AI (artificial intelligence).”

Fewer could define it.

Today, it’s leading the conversation. OpenAI’s fast-spreading ChatGPT and DALL-E, Google’s Bard, Meta’s LLaMA, and Microsoft’s ChatGPT-powered Bing have quickly put these language-based chatbots into the mainstream.

Exponential growth

ChatGPT surged past 100 million users less than two months after its November 2022 debut. Facebook, by contrast, took four-and-a-half years to surpass the same mark.

Even with preliminary signs of slowing growth, many agree these chatbots are here to stay. As one technologist observed in Harvard Business Review, “We are at the beginning of another technological revolution.”

With such a revolution underway, church leaders should keep some legal and risk management considerations in mind, including intellectual property, misinformation, privacy, defamation, cybersecurity—and even hiring.

Another tool—but not just any tool

Technology in ministry has evolved a lot over the past 25 years. Some leaders recall debating how their churches should build their websites.

From there, text-based messaging and church management software appeared.

Soon after, social media sites and online giving tools popped into focus.


A Pastor’s Take: Lead Not Your Church into Fear of AI


Then came smart phone apps to handle anything from communications to donations to administrative tasks.

Generative AI is different not only for what it does, but also in how quickly it evolves.

“Generative AI systems fall under the broad category of machine learning,” notes global consulting giant McKinsey & Company. McKinsey then asked ChatGPT to describe itself: “This nifty form of machine learning allows computers to generate all sorts of new and exciting content, from music and art to entire virtual worlds,” the resulting response said.

Learning as it goes

In other words, chatbots learn from questions and information submitted by users through a simple chat box, the chatbots’ own online searches, and user feedback. They then create new and better content for future queries.

The process is a self-perpetuating, iterative loop.

For instance, ChatGPT 3.5—launched in November of 2022—was already significantly inferior when ChatGPT 4 released just four months later.

To illustrate, ChatGPT 3.5 scored in the 10th percentile for the Uniform Bar Exam used by many states to license attorneys. ChatGPT 4 scored in the 80th percentile.

Such rapid change has triggered much wonder regarding storytelling, art, music, and more.

It also has generated much concern, ranging from cybersecurity threats (such as more sophisticated phishing and malware) to school cheating to existential threats to humans.


Does all this talk of gen AI have you thinking about other IT-related issues? Consider picking up a copy of Nick Nicholaou’s “Church IT.


Church leaders should start thinking now about how these content-creating chatbots will shape their ministries, whether driven through their own initiatives or thrust upon them by outside forces.

Here are some early considerations to note:

Intellectual property

Churches and pastors create lots of original content. Sermons. Children’s plays. Worship music. Website fodder. Social media posts.

Looking to generative AI chatbots for help requires extreme caution, though. Chatbots aren’t necessarily pulling together fully original creations. As they scour sources provided by a user, as well as readily available information online, they can easily grab material verbatim as they go.


Think About It: Christians are asking ChatGPT about God. Is this different than Googling?


That means chatbots most likely are grabbing and using pieces of works owned by other people or companies. Any resulting uses very likely violate copyright law—and courts have found that can be true even if duplications involve only a few notes or phrases.

Leaders must recognize the potential perils involved with instructing a chatbot to create a sermon about, say, The Beatitudes. Or to orchestrate a worship song based on the influences of current chart-setters. Or to generate a script for a Christmas pageant.

Not a ‘super search engine’

In a white paper, OpenAI openly discusses the way ChatGPT “hallucinates” as it works—another way of saying the chatbot sometimes creates fictitious details to support the task it was given.

One New York lawyer learned this the hard way. He asked ChatGPT to write a brief on behalf of a client suing an airline. He submitted the document. When the airline’s lawyers couldn’t locate any of the cases, the court asked for more information. Turns out, the brief cited fabricated cases and statutes to try and support the client’s case.

The attorney, facing sanctions, said he believed ChatGPT operated like “a super search engine.” It doesn’t. Leaders again must carefully vet what a chatbot produces for most any task.

Subtle inaccuracies are as much a threat as outright fabrications, too.

Here’s an example:

We asked ChatGPT 4 to write about NFL quarterback John Elway’s greatest game. The chatbot quickly answered Super Bowl XXXII, the hall-of-famer’s first championship win. It supported its response with his game statistics, but erroneously listed ones he earned a year later during his team’s Super Bowl XXXIII victory.

Defamation

Generative AI also poses potential defamation concerns.

In June of 2023, a Georgia radio host sued ChatGPT. A journalist-generated query produced a ChatGPT response that included a legal complaint about the host, and allegations he embezzled from a gun-rights group. The legal complaint, though, was fake, another example of a chatbot providing unpredictable—if not false—information.

This situation also reveals other ways churches and pastors may encounter less-than-ideal situations with the technology, says Jonathan Smith, president of technology consulting firm MBS, Inc., and director of technology for Faith Ministries in Indiana.

A generative AI query using your church’s name, or your pastor’s name, will draw from myriad sources, including negative posts, comments, or social media across the web.

It also could do damage in unexpected ways. “Generative AI has no intuition, no understanding,” Smith says, adding “it will draw the conclusion your church or your pastor is bad.”

Privacy

OpenAI discovered a bug with ChatGPT that exposed user chat histories along with payment and contact information for some of OpenAI’s premium subscribers. The problem was fixed. But when users now sign up, they see an onscreen message warning them about the sharing of any sensitive or personal information.

For churches, this again provides an important reminder about getting consent from congregants before publicly sharing prayer requests.

A well-meaning pastor or staff member, crafting the next church website update or e-newsletter, might contemplate pouring the text of requests into a chatbot to create the message. Doing so places potentially sensitive information about individuals into the chatbot. The public disclosure of private facts is the basis of an “invasion of privacy” lawsuit.

Lack of user support and feedback

There isn’t an immediate remedy available.

A user can submit feedback indicating a response contains faulty or false information. But, as Smith points out, other platforms like Facebook, Twitter, and Instagram struggle to keep up with user feedback, and ChatGPT and its peers likely will, too.

But leaders should still note this added concern from generative AI’s unpredictability. Exercise extreme caution especially before using any AI-generated responses containing information about other church and ministry leaders.

Cybersecurity

The powerful learning fostered by generative AI offers possibilities for good, including medical imaging and weather forecasting. There are also possibilities for more sophisticated crime. One cybersecurity company executive told the ABA Journal “you’re going to see phishing emails that are so believable you don’t know you’re talking with a machine.”

These schemes use an email to impersonate someone with authority and trick the recipient to click a malicious link or transfer funds to an unauthorized bank account. A misstep can prove costly. Education, training, and best practices can help pastors and staff thwart these attempts.

On the positive side, new generative AI tools are available to determine whether a message originated from a person or a chatbot, including one from OpenAI (note, however, that it requires a minimum of 1,000 characters to analyze).  

Job applications, references, and schoolwork

Does your church ask job applicants for responses to short-answer questions? What about recommendations from past employers or professional references?

Does your church run a school and regularly grade schoolwork?

Note the developing tools for sorting out original content from computer-generated content, which is becoming an industry unto itself.

Editors’ Note: We updated this content on July 25, 2023, with additional information along with comments from Jonathan Smith, president of technology consulting firm MBS, Inc., and director of technology for Faith Ministries in Indiana.

Matthew Branaugh is an attorney and editor for Church Law & Tax.

A Pair of Noteworthy Supreme Court Decisions For Church Leaders

A pair of Supreme Court decisions are noteworthy for church leaders and bivocational pastors.

A pair of noteworthy Supreme Court decisions are worth reviewing for church leaders, and bivocational pastors and church planters working secular jobs.


—Access our entire legal library with a Church Law & Tax Advantage Membership


The first, Groff v. DeJoy, represents a significant shift in the way employers treat religious accommodation requests under Title VII of the Civil Rights Act of 1964. Bottom line? Employers face a higher standard when rejecting such requests, meaning employees enjoy greater protection when they come across work situations that clash with their religious beliefs and convictions.

Meanwhile, the Supreme Court ruled 6-3 in favor of a Colorado web designer who worried the state would use its anti-discrimination laws to force her to create websites celebrating marriages she does not endorse (303 Creative LLC v. Elenis). It’s an outcome that underscores the possible ways a church can assert First Amendment defenses if the church falls under a state or local public accommodations law and gets penalized for violating the law due to its religious activities.

For members, Church Law & Tax Co-Founder and Senior Editor Richard Hammar, and Church Law & Tax Editor and Attorney-at-Law Matthew Branaugh joined forces to highlight what these important cases mean for churches and church leaders, alike:

Supreme Court Sides With Colorado Web Designer’s Free Speech Claim

Lorie Smith worried Colorado would use its anti-discrimination laws to force her to create websites celebrating marriages she does not endorse.

The First Amendment’s guaranty of free speech prohibits a Colorado public accommodations law from forcing a website designer with Christian beliefs to create messages with which she disagrees, the United States Supreme Court ruled.

A 6-3 majority favored the designer in its decision published in June of 2023 (303 Creative LLC v. Elenis, 600 U.S. 570). Although the ruling drew from speech—rather than religious—protections found in the First Amendment, the outcome represents another in a long line of victories for religious liberty proponents dating back more than a decade.

Churches and church leaders will find the 303 Creative ruling important in at least one way. It demonstrates the possible ways a church can assert First Amendment defenses if the church falls under a state or local public accommodations law and gets penalized for violating the law due to its religious activities.

‘A credible threat’ of penalty

The Colorado Anti-Discrimination Act (CADA) bars places of public accommodation from discriminating based on disability, race, creed, color, sex, sexual orientation, gender identity, gender expression, marital status, national origin, or ancestry in the provision of goods and services to the public.

The law first drew attention from the Supreme Court several years ago. That’s when Colorado’s civil rights division sanctioned a bakery owner for refusing to make a cake for a same-sex couple’s wedding. Lower courts affirmed the state’s actions.

But in 2018, a 7-2 ruling from the Supreme Court reversed the lower court decisions and returned the case to Colorado for reconsideration. The court said the record showed the civil rights division exhibited hostility toward the baker’s religious beliefs, violating his constitutional rights (Masterpiece Cakeshop, Ltd. v. Colo. Civil Rights Comm’n, 138 S. Ct. 1719 (2018)).

During the Masterpiece Cakeshop litigation, the website designer filed her lawsuit. She became worried CADA would require her to create wedding websites for same-sex couples, which goes against her religious beliefs.

The state had yet to sanction her. But her lawsuit was allowed to proceed because she established “a credible threat that . . . Colorado will invoke CADA to force her to create speech she does not believe or endorse,” wrote Justice Neil Gorsuch in the Supreme Court’s majority opinion.

Threat of forced speech violated free speech rights

Such a threat violated the designer’s free speech rights, the Court decided.

“[I]n this particular case Colorado does not just seek to ensure the sale of goods or services on equal terms,” the Court held. “It seeks to use its law to compel an individual to create speech she does not believe.”

The Court also ruled that “no public accommodations law is immune from the demands of the Constitution . . . and when a state public accommodations law and the Constitution collide, there can be no question which must prevail.”

Creating customized messages

The designer operates a graphic design business. She wanted to expand it to include services for couples seeking websites for their weddings. Her websites will provide couples with text, graphic arts, and videos to “celebrate” and “convey” the “details” of their “unique love story.”

A created website will be “expressive in nature,” designed “to communicate a particular message.” That message includes how the couple met, their backgrounds, and their families. It also includes their future plans and information about their upcoming wedding.

All text and graphics will be “original,” “customized,” and “tailored” creations.

The designer’s company name will also appear on every web page created.

The designer said her graphic design business is open to customers regardless of their race, creed, sex, or sexual orientation.

But by expanding her company’s services to include wedding websites, she worried Colorado’s public accommodations law would “force her to convey messages inconsistent with her belief that marriage should be reserved to unions between one man and one woman,” the Court noted.

The designer acknowledged her views about marriage may be unpopular.

But, the Court said, she insisted the Constitution protects such a view.

A district court rejected the designer’s claims. A federal appeals court affirmed the district court’s decision. The designer then appealed to the Supreme Court.

The Supreme Court’s decision

The Supreme Court began its majority opinion by noting if there is any “fixed star in our constitutional constellation,” it is the principle that the government may not interfere with “an uninhibited marketplace of ideas.” West Virginia Bd. of Ed. v. Barnette, 319 U. S. 642 (1943).

The Court continued:

The First Amendment protects an individual’s right to speak his mind regardless of whether the government considers his speech sensible and well-intentioned or deeply “misguided,” and likely to cause “anguish” or “incalculable grief.” And equally, the First Amendment protects acts of expressive association. . . . Generally, too, the government may not compel a person to speak its own preferred messages.

The Court noted the designer’s unique, customized wedding websites qualified as “pure speech,” entitling her to the maximum protection under the First Amendment guarantee of free speech, and concluded:

In this case, Colorado seeks to force an individual to speak in ways that align with its views but defy her conscience about a matter of major significance. In the past other States … have similarly tested the First Amendment’s boundaries by seeking to compel speech they thought vital at the time. But, as this Court has long held, the opportunity to think for ourselves and to express those thoughts freely is among our most cherished liberties and part of what keeps our Republic strong. Of course, abiding the Constitution’s commitment to the freedom of speech means all of us will encounter ideas we consider “unattractive,” “misguided, or even hurtful.” But tolerance, not coercion, is our Nation’s answer. The First Amendment envisions the United States as a rich and complex place where all persons are free to think and speak as they wish, not as the government demands. Because Colorado seeks to deny that promise, the [district court’s] judgment is reversed.

Why church leaders should take notice

This case protects Christian business owners from potential liability under public accommodations laws when goods or services involve speech.

But there is another aspect of this ruling that may be of even greater importance to churches. The Court majority emphasized that constitutional protections will prevail anytime they “collide” with a state public accommodations law. This is especially notable, given the uncertainties that often arise for churches whose activities may or may not fall under state and local public accommodations laws.

The first public accommodations laws were enacted by a few states in the late 19th century. That number has steadily increased and by 2023 most states have enacted such a law.

Public accommodations laws vary by state

But public accommodations laws vary by state. To illustrate:

  • All public accommodation laws bar places of public accommodation from discriminating against patrons based on several enumerated categories, including some, or all of, the following: race, color, national origin, gender, religion, disability, marital status, and sexual orientation.
  • In recent years, a growing number of state public accommodation laws have banned discrimination based on marital status, sexual orientation, and sexual identity. According to the National Conference of State Legislators, “18 jurisdictions prohibit discrimination based on marital status, 25 prohibit discrimination based on sexual orientation, [and] 24 prohibit discrimination based on gender identity.”
  • Some state laws exempt religious organizations, but others contain no explicit exemption.

Many pastors employed by conservative congregations worry public accommodations laws may be used to compel them to accommodate persons who do not share the church’s biblical worldview or values.

Learn more: Search public accommodations laws, including ones affecting your church, through Church Law & Tax’s 50-State Public Accommodations Laws Report, a downloadable resource.

An oft-mentioned concern among church leaders

An oft-mentioned concern pertains to the use of church property. To illustrate, assume that a church with an orthodox view of marriage and human sexuality rents its sanctuary to the public as a means of raising revenue.

A gay couple contacts the pastor requesting use of the sanctuary for their wedding.

Does the fact that the church rents its sanctuary to the public make it a place of public accommodation and subject the church to liability if it rejects the gay couple?

After the 303 Creative decision, if a state or local public accommodations law is defined to include churches, or if such a law is construed by a court or administrative agency to include them, churches now can assert a constitutional defense to coverage based on the First Amendment’s free exercise or nonestablishment of religion and free speech clauses.

Dig Deeper:Public Accommodations Laws”—part of Church Law & Tax’s series on “15 Things Richard Hammar Wants Pastors to Know,” looks more closely at the application of public accommodations laws to churches and clergy.

Consider these seven questions

Prior to any actions taken by a court or administrative agency, though, church leaders should review the following seven questions, preferably in consultation with qualified legal counsel. Doing so will help identify potential legal liabilities, and possible ways to minimize those liabilities:

Is there a public accommodations law in my city or state?

  • If so, what types of discrimination does it prohibit?
  • Does the law provide an exemption for churches?
  • If the law provides an exemption for churches, are there any conditions that must be satisfied?
  • If the law does not contain an explicit exemption for churches, what is the official position of the civil rights agency tasked with enforcement of the law? Does the agency take the position that churches are exempt? And if so, do any conditions apply? For example, does the exemption apply to churches that rent their properties to raise revenue?
  • If a state or local civil rights agency tasked with enforcement of a public accommodations law claims that it applies to churches that are engaged in commercial or other activities unrelated to exempt religious purposes, does church coverage only apply during the use of church property for the unrelated purpose, or more broadly to include all uses of church property?
  • Does the church’s constitutional rights of religion and speech take priority over a public accommodations law?

303 Creative LLC v. Elenis, 600 U.S. ___ (2023)

Matthew Branaugh, attorney and editor of Church Law & Tax, contributed to this report.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

Supreme Court’s ‘Groff’ Decision Makes It Harder to Reject Religious Accommodations Requests

Bivocational pastors and church planters working secular jobs should pay attention to what the Groff decision means.

Employers must now make a stronger case before denying religious accommodation requests under Title VII of the Civil Rights Act of 1964. The U.S. Supreme Court clarified that denials must be based on a “substantial burden” to the employer’s business—not just a minimal inconvenience.


What Title VII Protects

Title VII prohibits employment discrimination based on:

  • Race
  • Color
  • National origin
  • Gender
  • Religion

It also requires employers to “reasonably accommodate” an employee’s religious practices, unless doing so causes undue hardship to the business.


A Stronger Standard for Religious Requests

For more than four decades, lower courts allowed employers to reject religious accommodations using a low threshold: the “de minimis” standard—meaning any small burden was enough.

But in Groff v. DeJoy (2023), the Supreme Court changed that. The justices made clear that employers must now demonstrate a substantial, real burden if they want to deny a religious accommodation.

This decision offers stronger protections for religious practices in the workplace, including:

  • Wearing religious attire
  • Observing a Sabbath
  • Other sincerely held beliefs

This is especially meaningful for bivocational pastors and church planters working both in ministry and secular jobs.


Who Is Covered?

This ruling only applies to employers subject to Title VII, which means:

  • Engaged in interstate commerce
  • Have 15 or more employees

📚 Many state civil rights laws provide similar protections, often with lower employee thresholds.


The Court’s Clarification

Writing for the Court, Justice Samuel Alito emphasized:

“Most lower courts have incorrectly latched on to ‘de minimis’ as the governing standard.”

He noted that the 1977 case Hardison v. Trans World Airlines used “undue hardship” as the core concept—but lower courts focused instead on the fleeting mention of “de minimis.”

Even the Equal Employment Opportunity Commission (EEOC) has moved away from “de minimis,” acknowledging that the law requires more than a minor cost.

Alito warned that prior interpretations made it harder for minority faiths to seek fair treatment:

“The ‘de minimis’ test … has blessed the denial of even minor accommodation in many cases.”


The Groff Case: Sundays Off

Gerald Groff, an Evangelical Christian, worked for the U.S. Postal Service (USPS) in Pennsylvania.

  • In 2013, USPS began delivering Amazon packages on Sundays.
  • Groff transferred to a location that didn’t yet require Sunday work.
  • When that location later began Sunday deliveries, Groff sought a religious accommodation.

Groff’s lawyer said the request wasn’t formally rejected—but in practice, Groff was disciplined for not working Sundays.

The USPS argued Groff’s request created staffing conflicts and caused disruption. Eventually, Groff resigned and sued.


What the Court Decided

The Supreme Court did not decide whether USPS met the new “substantial burden” standard. Instead, it sent the case back to lower courts to reconsider under the clarified rule.

The Court also didn’t define a precise test for employers—but pointed back to the original Title VII language:

“A hardship is, at a minimum, something hard to bear,” Alito wrote.

He added that relevant considerations include:

  • The specific accommodations requested
  • The nature, size, and costs of the business
  • The practical impact of granting the request

Bias Is Not a Justifiable Burden

The Court made clear that prejudice or hostility toward religion cannot be used to claim hardship.

“A hardship that is attributable to employee animosity to a particular religion … cannot be considered ‘undue,’” Alito said.


Real-World Examples

Example 1:
Pastor Craig applies to be a delivery driver for Amazon. He can’t work Sundays due to his church responsibilities.

  • Old rule: Amazon could argue that even a small inconvenience was enough to deny his request.
  • New rule: Amazon must now show that giving Craig Sundays off would cause substantial difficulty or cost to the company.

Example 2:
Same situation—but this time, Craig applies at a local business with only 10 employees.

  • Title VII does not apply, since the business has fewer than 15 workers.
  • However, state laws may still protect Craig, depending on the jurisdiction.

Contributing Author: Richard R. Hammar, Church Law & Tax Co-Founder and Senior Editor

Matthew Branaugh is an attorney and editor for Church Law & Tax.

Colorado Supreme Court Overturns Part of Sexual Abuse Claims Law

The Colorado Supreme Court says the Child Sexual Abuse Accountability Act goes against the state’s constitution.

In June of 2023, the Colorado Supreme Court ruled that a portion of the state’s Child Sexual Abuse Accountability Act (“CSAAA” or “the Act”) violates the state’s constitution.

The court specifically struck down a portion of the law allowing certain lawsuits otherwise barred by the statute of limitations.

Prior to CSAAA’s passage, Colorado law only permitted claims for six years after they occurred or for the six years after a victim either turned 18 or discovered (often through counseling) that they had been abused.

Law expanded victims’ rights

Colorado lawmakers passed the CSAAA in July of 2021 for victims of sexual misconduct while participating in a youth-related activity or program. It took effect on January 1, 2022.

Victims can bring civil claims for damages against their abusers and the organizations that managed the activities or programs if the organizations knew or should have known about the risk of sexual misconduct.

CSAAA also established a three-year window for victims to bring forward claims that allegedly occurred between January 1, 1960, and January 1, 2022. The Act said claims could be made between January 1, 2022, and January 1, 2025, regardless of whether previously available causes of action were barred by a statute of limitations.



Additionally, the law established other significant rights.

First, the Act said “(t)here is no limitation on the time to bring a claim for sexual misconduct that occurs on or after January 1, 2022.” Second, the law voids “purported pre-incident waivers” as a matter of public policy, meaning victims no longer can be asked by an alleged abuser or organization to waive their rights to bring civil actions. And third, the act waives immunity for any claims brought under it against government employees and government entities.

Victims can seek up to $387,000 against public entities and up to $1 million against private entities.

‘New right of relief’

Some lawmakers found that many civil claims brought by adults who were sexually abused as children are often dismissed due to the statute of limitations. The Colorado Attorney General estimated that most adult survivors don’t come forward on average until the age of 53, according to the Associated Press.

Key Point: The statute of limitations specifies the deadline for filing a civil lawsuit. Lawsuits cannot be brought after this deadline has past.

In drafting the law, lawmakers wanted the CSAAA to create “a new right for relief for any person sexually abused in Colorado while the person was participating in a youth-related activity or program as a child,” while not attempting to revise “any common law cause of action that is time-barred.”

The latter issue raised concerns during the lawmaking process.

Questionable constitutionality

Before CSAAA’s passage, a law professor told Senate Judiciary Committee members the bill was, in his opinion, unconstitutional, retrospective legislation.

“By creating a whole new cause of action,” the professor testified, the bill “imposed new obligations on past actions, which is literally what the Supreme Court has said is forbidden.”

CSAAA supporters pointed to the need for giving victims a remedy, despite questions about the law’s constitutionality.

Almost instantly challenged

Soon after CSAAA took effect, plaintiffs “A.S.” and her husband, “B.S.,” brought a claim against a former high school athletic coach and a school district. The plaintiffs alleged the coach sexually abused A.S. between 2001 and 2005, when A.S. was a minor.

Without CSAAA, the claim would have otherwise been time-barred by the statute of limitations.

A lower court ruled against the plaintiffs. The plaintiffs appealed to the Colorado Supreme Court.

Supreme Court expresses concerns about retrospective legislation

The Colorado Supreme Court ruled that the CSAAA violates article II, section 11 of the Colorado Constitution (the “retrospectivity clause”). This section prohibits the legislature from passing any law “retrospective in its operation.” CSAAA, the supreme court continued, “amounts to unconstitutional retrospective legislation as applied to the plaintiffs’ claims under the Act against the defendants [and] and accordingly, we affirm the district court’s order granting the defendants’ motions to dismiss.”

The Court observed:

We certainly understand the General Assembly’s desire to right the wrongs of past decades by permitting such victims to hold abusers and their enablers accountable. But the General Assembly may accomplish its ends only through constitutional means.

The retrospectivity clause of the Colorado Constitution prohibits retroactive legislation that creates a new obligation, imposes a new duty, or attaches a new disability with respect to past transactions or considerations. By creating a “new right for relief” that attaches liability for conduct predating the Act and for which any previously available cause of action would be time-barred, the CSAAA does just that. The CSAAA is therefore unconstitutional as applied to the plaintiffs’ claim in this case. Accordingly, the district court’s order granting the defendants’ motions to dismiss is affirmed.

The supreme court also noted that other portions of the law remain valid:

We do not hold that the CSAAA is unconstitutional in its entirety, or that all claims made under the CSAAA are precluded by the retrospectivity clause. Our holding does not affect claims brought under the CSAAA for which the previously applicable statute of limitations had not run as of January 1, 2022.

Extender laws have widespread support

In recent years, several states have passed laws eliminating or extending the statute of limitations for child abuse claims that were time-barred under prior law.

The purpose is clear and compelling—to provide a “second chance” to victims of childhood sexual abuse who, for whatever reason, were unable to bring a civil claim against their abuser prior to the expiration of the statute of limitations.

These laws have widespread public support.

But these same laws might put churches and denominations into an indefensible position.

In decades-old abuse claims, memories have faded, and personnel have changed. Often few if any staff or members are even aware of the alleged incident or the perpetrator. Moreover, church leaders don’t know if the church had liability insurance coverage at the time of the incident that may be implicated.

With this trend in state laws, this case demonstrates that, in some cases, the equities still may tip in favor of defendants.

This case also demonstrates the ways that states are more aggressively pursuing rights for victims. The Colorado Supreme Court emphasized the CSAAA was not struck down in its entirety. The law still includes language effectively attempting to eliminate time bars for alleged acts occurring after January 1, 2022. It also voids any waivers signed by victims that attempt to take away their rights to seek civil remedies.

Church leaders should understand state laws

Church leaders should be aware of any extension or amendment of the statute limitation for sexual abuse claims in their state. They also should note the increased efforts by legislatures to afford more rights to victims. This means the church may have to defend against cases that are many years and even decades in the past.

Church leaders should also recognize expanded rights to victims for acts perpetrated in the recent past and in the future.

Sound risk management, and permanent retention of all liability insurance policies, are imperative practices.

Aurora Public Schools v. A.S., (Colo. 2023).

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

Off-Campus Liability and Churches

Off-campus liability is an ongoing question for churches and church leaders to address in light of these key cases.

Church events often happen beyond the building’s walls. That’s why understanding legal risks tied to off-campus activities is critical.

Courts have weighed in on this issue in both church-related and non-religious charity cases. These examples offer key insights for ministry leaders.


Join Church Law & Tax


Why This Matters

Church leaders should:

  • Review the facts of each legal case
  • Understand court decisions
  • Identify practical takeaways and risk factors

Doing so helps churches evaluate their potential liability for off-site activities.


Case Study 1: Church Picnic ATV Accident

A Sunday School teacher organized a picnic on a member’s property. While the pastor attended, he did not help plan the event.

Key facts:

  • Invitations were shared during Sunday School.
  • Church members brought food and recreational equipment, including rifles and an ATV.
  • A 15-year-old drove the ATV on a public road, injuring a passenger.

The injured party’s parents sued the driver’s parents and the church. The court ruled:

  • The church’s insurance policy did not cover the incident.
  • Policy language clearly limited coverage to activities performed on behalf of or at the direction of the church.
  • The church had no role in authorizing the ATV’s use.

Key takeaway: A church may be liable only when an activity is directed, requested, or carried out for its benefit.

Case citation: ASI Insurance Company, 2022 WL 2760479 (N.D. Fla. 2022)


Case Study 2: Halloween Hayride Injury

A woman was seriously injured while preventing a child from falling off a church-sponsored hayride.

The appellate court reversed a trial court dismissal based on:

  • Overloading: The church allegedly decided ride precautions, lighting, and passenger limits.
  • Negligent Supervision: Poor lighting and a lack of control over rowdy children on the trailer.

The court found the church owed a duty of care to children it was supervising.

Key takeaway: Inadequate supervision, overloading, and poor planning can create church liability.

Case citation: Clontz v. St. Mark’s Evangelical Lutheran Church, 578 S.E.2d 654 (N.C. App. 2003)


Case Study 3: Deadly After-School Party

A church-operated school faced a lawsuit after two students died following an off-campus, unsanctioned party where alcohol was consumed.

Verdict Breakdown

  • The school and its principal settled for $1.1 million.
  • A jury assigned 25% fault to the school and awarded $55+ million in damages.
  • The appellate court ruled the party was neither school-sponsored nor school-related.

Key takeaways:

  • Liability requires more than just awareness of an off-campus event.
  • Courts distinguish between sponsored and related activities.

Case citation: Archbishop Coleman F. Carroll High School, Inc. v. Maynoldi, 30 So.3d 533 (Fla. App. 2010)


Case Study 4: Youth Soccer Club Carpool Crash

A 16-year-old, at a coach’s direction, transported teammates to practice and caused a major crash.

Court Decision

  • Though 83% of fault was assigned to the driver, the soccer club was ordered to pay the full verdict due to the coach’s control over logistics.
  • The court confirmed the legal principle of respondeat superior—an organization may be liable for the actions of volunteers acting under its authority.

Key takeaway: Direction and control over a volunteer’s actions can trigger liability—even without formal employment.

Case citation: Bartell ex rel. Hoesel v. Mesa Soccer Club, 2010 WL 502993 (Ariz. App. 2010)


Additional Cases Highlighting Liability Factors

Baseball Game Carpool Tragedy

A 16-year-old volunteer driver caused a fatal crash. The court said a jury must decide if the sponsoring organization (the American Legion) was liable.

Case: Daniels v. Reel, 515 S.E.2d 22 (N.C. App. 1999)


A church volunteer struck a motorcyclist while delivering cookies. The court found the church may be liable due to its control over the volunteer’s actions.

Case: Trinity Lutheran Church, Inc. v. Miller, 451 N.E.2d 1099 (Ind. App. 1983)


School Officials Aware of Underage Drinking

A student died in a crash after an unsanctioned party. Although school officials were aware of the drinking, the court ruled the school had no duty since the party was not officially sanctioned.

Case: Rhea v. Grandview School District, 694 P.2d 666 (1985)


Hazing at Club Meeting

A student was injured during a hazing incident at a school-sponsored, off-campus club meeting. The court found the school liable.

Case: Rupp v. Bryant, 417 So.2d 658 (Fla. 1982)


Unauthorized Teacher Excursion

A college was not liable when a teacher led a student outing after classes had ended. The outing was not authorized or affiliated with the school.

Case: Fernandez v. Florida National College, Inc., 925 So.2d 1096 (Fla. App. 2006)


Final Takeaways for Church Leaders

Liability for off-campus activities isn’t automatic—but it’s possible.

When Is a Church More Likely to Be Liable?

  • The activity is directed, requested, or benefits the church.
  • The church officially endorses, promotes, or provides resources for the event.
  • Staff or leaders attend in an official capacity.

Questions to Ask Before Off-Site Events

  1. Was the event planned by a recognized church committee or group?
  2. Did planners seek permission or resources from the church?
  3. Has the church helped coordinate logistics?
  4. Was the event promoted in church channels?
  5. Will staff attend as official representatives?

If the answer to any of these is “yes,” the event may be viewed as church-related—and liability increases.


Risk Mitigation Strategies

To reduce risks during off-campus events:

  • Assign trained staff or volunteers.
  • Ensure adequate lighting and safety precautions.
  • Limit crowd size or participation.
  • Screen and select drivers carefully.
  • Hire professionals for high-risk activities.

Consult with legal counsel and your insurance provider before the event.


Consider a Non-Sanctioned Event Policy

A clear policy stating the church will not be liable for events it does not officially sanction may help demonstrate your position.

While not a complete legal shield, it may reduce exposure—especially when coupled with:

  • A formal event approval process
  • Guidelines for requesting sponsorship
  • Leadership training in liability awareness


Further Reading: This church was found not liable for injuries sustained by a teenager at an off-campus church event. Click here to find out the specifics.


Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

Key Tax Dates July 2023

Key tax dates include filing Forms 8274 and 941, and meeting monthly or semiweekly filing requirements.

Monthly requirements

If your church or organization reported withheld taxes of $50,000 or less during the most recent lookback period (for 2023 the lookback period is July 1, 2021, through June 30, 2022), then withheld payroll taxes are deposited monthly.

Tip: The 2023 Church & Clergy Tax Guide is available—order a print copy today (while supplies last) or download the .pdf version now.

Monthly deposits are due by the 15th day of the following month. Note, however, that if withheld taxes are less than $2,500 at the end of any calendar quarter (March 31, June 30, September 30, or December 31), the church or organization need not deposit the taxes.

Instead, it can pay the total withheld taxes directly to the IRS with its quarterly Form 941. Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes, and the employer’s share of Social Security and Medicare taxes.

Semiweekly requirements

If your church or organization reported withheld taxes of more than $50,000 during the most recent lookback period (for 2023 the lookback period is July 1, 2021, through June 30, 2022), then the withheld payroll taxes are deposited semiweekly. This means that for paydays falling on Wednesday, Thursday, or Friday, the payroll taxes must be deposited on or by the following Wednesday. For all other paydays, the payroll taxes must be deposited on the Friday following the payday.

Also note that large employers having withheld taxes of $100,000 or more at the end of any day must deposit the taxes by the next banking day. The deposit days are based on the timing of the employer’s payroll. Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes, and the employer’s share of Social Security and Medicare taxes.

July 28, 2023: File employer exemption—Form 8274

Churches hiring their first nonminister employee between April 1 and June 30 may exempt themselves from the employer’s share of Social Security and Medicare taxes by filing Form 8274 by this date (nonminister employees are thereafter treated as self-employed for Social Security purposes). The exemption is only available to churches that are opposed based on religious principles to paying the employer’s share of Social Security and Medicare taxes.

July 31, 2023: File Form 941

Churches having nonminister employees (or one or more ministers who report their federal income taxes as employees and who have elected voluntary withholding) must file an employer’s quarterly federal tax return (Form 941) for the second quarter of 2023 by this date. Enclose a check in the total amount of all withheld taxes (withheld income taxes, withheld Social Security and Medicare taxes paid by the employee, and the employer’s share of Social Security and Medicare taxes) if less than $2,500 on June 30, 2023.

Note: If a date listed for filing a return or making a tax payment falls on a Saturday, Sunday, or legal holiday (either national or statewide in a state where the return is required to be filed), the return or tax payment is due on the following business day.

Note: You must use electronic funds transfer to make all federal employment tax deposits. This is generally done using the Electronic Federal Tax Payment System, a free service provided by the US Department of Treasury. If you don’t wish to use EFTPS, you can arrange for your tax professional, financial institution, or payroll service to make deposits on your behalf. Failure to make a timely deposit may subject you to a 10-percent penalty.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

Part 1 of 4: Prepping for a Church Meeting

Preparation is key in holding an effective church meeting.

Editor’s Note: Prepping for a church meeting is as important as the meeting itself. Continuing her look at effective business meetings through the hypothetical lens of Liz Jones, an experienced business administrator at First Church, Sarah E. Merkle walks us through the three-step process of planning, defining, and ordering a meeting agenda.

This four-part series is offered in support of Merkle’s Mastering Meeting Basics.”


An effective church meeting can go a long way toward healthy and effective decision-making. Planning the meeting, therefore, is key.

Planning a church meeting: The problem

Liz Jones needs an effective business meeting plan.

Last year, First Church’s annual business meeting didn’t go so well. This year, Pastor Steve Hayes has asked Jones to fix that.

Jones, an experienced business administrator, knows preparation will be key. The congregationally led church is 16 years old and recently surpassed 500 members.

As the church grows, the need for meetings to go well only grows, too.

A few things went wrong at last year’s annual meeting:

  • It ran too long.
  • Discussion over pricey upgrades to the church’s audio/visual equipment went in circles.
  • A key decision related to making a minor tweak to one of the church’s bylaws got delayed because proper notice wasn’t given ahead of time to members.

The next annual business meeting—planned for Sunday, January 8, 2023, at 12:30 p.m.— is still several months away, but Jones knows she needs to work fast to plan and organize it well.

A general search online yielded some ideas. Then she came across a Church Law & Tax article series by Sarah E. Merkle, an attorney with impressive credentials and experience helping churches, nonprofits, businesses, and organizations run meetings.

The article covering meeting preparation especially caught her eye. On a whim, she sent Merkle an email explaining her circumstances. A short while later, Merkle emailed back.

Creating an effective church meeting plan

Merkle couldn’t provide specific advice to Jones because legal ethics don’t allow it when an attorney-client relationship doesn’t exist.

But Merkle generally described steps Jones can take to put a better plan together.

Step 1: Get your to-do list in order

Put the church’s articles of incorporation, bylaws, and policy manuals all within arm’s reach, and read through them to note any dates by which things must happen. Whether nominating new board members or approving an annual budget or adopting a pastor’s housing allowance, these dates create deadlines—and to-do lists that should get completed by the appropriate meeting before the corresponding deadline.

For the annual business meeting, recurring dates include submitting board nominations whenever one or more members finish their terms, and getting congregational approval for the next year’s fiscal budget. This year, only the latter needs to happen.

Step 2: Define the agenda.

Merkle explained that initial formalities need to be addressed, such as approving the minutes of the last business meeting, plus adopting the agenda for this one.

From there, First Church needs its next fiscal budget approved. It also typically uses the annual business meeting to share updates from the church’s ministries, facilities, and financial health committees. This year, it also faces several other important decisions—it’s about to call a new associate pastor. It is also contemplating repaving its parking lot.

In the past, First Church has typically saved the biggest—and often most controversial—decisions for the end of its annual business meetings.

That’s what happened last year when the church wrestled with the audio/visual proposal. It was costly, members wanted to debate it, and, given that the meeting was already running long, frustrations mounted as a vote was pushed through.

Merkle cautioned Jones about prioritizing the agenda a certain way only because it’s “how the church has always done it.”

With the list of agenda items defined, Merkle said she asks these questions to further understand the potential flow for the agenda:

  • Who should speak or present on behalf of any of the agenda items? The chair of the associate pastor search committee, for instance, should plan to talk about the candidate and explain the process used for the search, including the qualifications sought and the other people interviewed.

All presenters should be identified and contacted early to get them started with their respective presentations.

  • What resources do these individuals need to succeed with their remarks? This might include PowerPoint and other audio/visual support—and it may require staff time to assist the presenter, especially if he or she is a volunteer.
  • What information about an issue can be given to members ahead of time to help them learn and understand what the issue is about? For the associate pastor role, that might include a biography of the candidate. For the parking lot project, it might include an explanation about why it’s needed, the potential costs, and the ministry impact it can deliver.
  • What notice is required under the church’s governance to ensure an issue can be voted on? Last year’s bylaw change didn’t provide proper notice—and this year, the church’s governance requires notice before members can vote to call any pastor.

Step 3: Ordering the agenda

The last major step is to order the agenda.

“There’s no right or wrong answer here,” Merkle wrote. “It’s more important to ask certain questions to decide how to do it. What are you ultimately wanting to accomplish at this meeting? Prioritize the agenda based on what needs to be decided for the healthy functioning of the church over the next 30 to 45 days.”

One evaluation is to anticipate controversies.

“Is everyone coming to the meeting because they are already angry about the issue? If so, then it needs to be earlier in the agenda,” Merkle wrote. “Is everyone coming calm, but an issue on the agenda may anger them? If so, then don’t schedule anything afterward that is heavy or serious—keep it straightforward.”

Another evaluation is the pros and cons of each item happening at specific times on the agenda.

With the associate pastor role, there are positives to placing it early on the agenda. Most people likely will attend because of this specific decision, and they’ll have more energy early in the meeting. One negative, though, is that updates about ministry and financial health may shape how people decide—and those reports would likely come later.

Relatedly, there are pros and cons to placing the item later in the agenda, too. The pro is that all information should be in hand. The con is that people are tired.

For Jones, the order is starting to take shape. Leading the agenda with the ministries, financial health, and facilities reports should start things on a positive note. The facilities report will then include the parking lot project.

From there, the agenda will shift into the associate pastor discussion and decision, since the meeting is still relatively young and the new role’s impact on the church’s mission and operations will be better understood.

Plus, adding the position directly influences the church’s healthy functioning within the next 45 days.

Lastly, the agenda will address approval of the next annual budget.

Jones now can begin working on contacting the individuals she needs to speak on the various topics, and the timetables needed to notify the congregation about the associate pastor vote.

“I’m really glad you reached out,” Merkle wrote. “The thought put into an annual business meeting can turn it into something invigorating. The time you’re using now to prepare can make a massive difference in how people feel—helping them see the big picture and celebrate the church’s direction.”



Sarah E. Merkle is a professional parliamentarian and presiding officer. One of five lawyers worldwide to have earned the credentials Certified Professional Parliamentarian-Teacher (CPP-T) and Professional Registered Parliamentarian (PRP), she helps boards, associations, corporations, and public bodies navigate rules applicable to governance and business meetings.

Correcting Improper FICA Withholdings

What to expect when correcting improper FICA withholdings for a pastor.

Q: Our church has been withholding FICA for its pastors, in some instances for years—or even decades. We recently learned this is a mistake. How do we fix this?


Wages paid to ministers are not included in the definition of wages for the purposes of withholding FICA/Medicare tax. This includes the related employer matching of these taxes by the church.   

Instead, ministers must pay into the Social Security/Medicare systems through self-employment tax calculated on Schedule SE with their personal tax returns (unless they obtain an exemption). 

Tip: Elaine’s expertise on FICA, payroll, FLSA, and a host of other key topics are on full display in Church Compensation: From Strategic Plan to Compliance. Pick up your copy today.

FICA withholding rules are confusing

Improper FICA withholdings is not uncommon. Churches often incorrectly withhold and match the FICA/Medicare taxes on ministers. If the IRS determines this treatment has occurred, it takes the position that the church has determined the employee is not a minister for payroll tax purposes. This may affect the taxation of other benefits. That’s because it’s impossible to claim to be a minister for one portion of the rules but not for another.

For an example of how the incorrect withholding of a minister’s payroll taxes can prove so consequential, look no further than the housing allowance that qualifying ministers are eligible to receive.

The housing allowance is one of the most valuable tax benefits available to ministers. If a church treats a minister incorrectly and withholds and matches the minister’s FICA/Medicare taxes, then the IRS views him or her as an employee, not a minister. The IRS then would tax the housing allowance paid by the church for the minister, representing a sizable financial loss for the minister. 

Correcting Improper FICA Withholdings

Churches that have improperly withheld/matched a minister’s FICA/Medicare taxes should amend the payroll reports for the three tax years open under the statute of limitations.

This requires amending quarterly Forms 941 and annual Forms W-2. Taxes paid will be refunded to the church. And, because it mistakenly overpaid its taxes, the church will not face any penalties.

The minister will need to report the compensation as self-employment income for the past three years. This is done by amending the related Forms 1040.

The minister also needs to pay the related self-employment tax owed. Interest will be calculated on the tax owed when he or she amends the Forms 1040. 

These amendments can be complicated, so a church may require professional assistance in filing the related amended reports and returns.


Learn more:


Elaine L. Sommerville is licensed as a certified public accountant by the State of Texas. She has worked in public accounting since 1985.

Part 4 of 4: Minding Meeting Minutes

Holding an effective church meeting includes knowing who should be keeping minutes and how they should be kept.

Editor’s Note: Minding meeting minutes is both an oft-misunderstood and under-appreciated part of a church business meeting. Continuing her look at effective business meetings through the hypothetical lens of Liz Jones, an experienced business administrator at First Church, Sarah E. Merkle shows the important roles that meeting minutes play.

This four-part series is offered in support of Merkle’s Mastering Meeting Basics.”


Long before First Church’s annual business meeting arrived, Liz Jones mapped out a plan for getting the meeting’s minutes taken, too.

Before proceeding, though, she first needed to clear up some misconceptions about who should take minutes. Some assumed it would be the church secretary. Others assumed it should be Jones as the church business administrator.

Neither assumption was correct.

Instead, the responsibility of taking minutes falls to the church board’s secretary.

Jones reached out to Tom Erickson, the board secretary, and scheduled a meeting ahead of time to go over his duties.

“I’m nervous about this task, to be honest,” Erickson confided to Jones when they met. “I have a hard time capturing everything said in a conversation—there’s so much to keep track of.”

“Don’t worry,” Jones responded. “I’ll help you understand exactly what we need. And remember, I’m attending the meeting, too. There should always be someone backing you up at a meeting, and I can do that for this meeting.”

Recording what is done, not said

Jones then walked Erickson through the key tips for taking effective minutes.

“You’re not recording the meeting, and you’re not transcribing the meeting,” she explained. “You’re recording what was done, not what was said.”

Erickson nodded but looked slightly confused.

“But to record what was done, don’t we need to know who said what—who supported what, who opposed what, that kind of thing?” he asked.

“No—that’s a common mistake many church leaders make,” Jones answered. “So much of what happens just needs to be a brief, general description. For instance, when Cindy Martinez gets up to give the facilities report, it doesn’t have to be detailed. It should just say, ‘The facilities chair gave a report on behalf of the facilities committee, including details on proposed projects for the parking lot, children’s ministry wing, and HVAC system.’ That’s it.”

Jones paused as Erickson jotted down some notes.

“Is there ever a time when specific details need to be included, though?” Erickson asked.

“Yes,” Jones responded. “Mainly when votes are taken. You need to record the outcomes. If specific counts are made, you need to capture the votes for and the votes against.”

Erickson scribbled down a couple more notes.



“So, this is really about just making sure ultimate decisions and directions are recorded for future reference—not a play-by-play,” he said.

“Exactly,” Jones responded. “And when the next business meeting comes, they’re already prepared and ready to be presented for approval as a way to formally document those decisions and directions.”

A closer look at the minutes

Erickson heeded Jones’s advice. Because he wasn’t focused on recording every word said, he found the task much more manageable—and capturing highlights and high-level details came more easily than he expected.

This especially proved true during the extensive discussion about the proposed facilities projects. Erickson knew he would have gotten flustered trying to note each perspective shared about support or opposition—and objectively representing the remarks would be next to impossible anyway.

After First Church’s annual business meeting, he cleaned up the notes he typed during the meeting. To his credit, he needed Jones’s backup notes for only one thing—the official vote count (243 to 13) in favor of the candidate for the new associate pastor role.

Erickson’s draft minutes looked like this:

First Church

Annual Business Meeting

January 8, 2023

12:30 p.m.

Board Chair Terry Christensen called the annual business meeting of First Church to order at 12:35 p.m.. A quorum was present.

Agenda

By unanimous consent, the agenda was adopted as presented.

2022 Annual Business Meeting Minutes

By unanimous consent, the minutes of the January 9, 2022 annual business meeting were approved as distributed.

Ministry Update

Outreach Coordinator Joy Allman provided an update on the progress of various ministries of the church, noting that the children’s ministry was experiencing significant growth and that the church leadership was exploring a new missions opportunity in Ecuador.

Finance Committee

Alex Armstrong, chair of the Finance Committee, provided an overview of the financial reports distributed to the membership, noting that member giving has been steady and that the building and property loan from 2016 remains the church’s only outstanding debt.

Facilities Committee

Cindy Martinez, chair of the Facilities Committee, provided an update on the state of the Church’s facilities. On behalf of the Committee, Ms. Martinez moved that the Facilities Committee obtain bids to begin the following capital projects during the next fiscal year: repave the parking lot, and replace the HVAC system; and, that the Facilities Committee be authorized to proceed with these projects, provided they do not exceed a combined total cost of $200,000. The motion was adopted as amended.

Associate Pastor Search Committee

Russ Moore, chair of the Associate Pastor Search Committee, provided an overview of the associate pastor search, including the Committee’s process for identifying and vetting candidates. On behalf of the Committee, Mr. Moore moved that First Church call Karl Miller to be associate pastor of First Church. The motion was adopted, with 243 in favor and 13 opposed.

2023–2024 Budget

On behalf of the Finance Committee, Alex Armstrong moved that the 2023–2024 budget be adopted as distributed. The motion was adopted.

Adjourn

By unanimous consent, the meeting adjourned at 2:00 p.m.

Sarah E. Merkle is a professional parliamentarian and presiding officer. One of five lawyers worldwide to have earned the credentials Certified Professional Parliamentarian-Teacher (CPP-T) and Professional Registered Parliamentarian (PRP), she helps boards, associations, corporations, and public bodies navigate rules applicable to governance and business meetings.

Part 3 of 4: Making Every Vote Count

Holding an effective church meeting includes understanding the four basic types of votes, and knowing which one is best.

Editor’s Note: Making every vote count in a church business meeting takes many forms. Continuing her look at effective business meetings through the hypothetical lens of Liz Jones, an experienced business administrator at First Church, Sarah E. Merkle illustrates the various types of votes that can be taken at a business meeting, and the methods for calculating their outcomes.

This four-part series is offered in support of Merkle’s Mastering Meeting Basics.”


Before First Church’s annual business meeting, Liz Jones met with Terry Christensen, the church board’s chairwoman, to go over the four types of votes that can be conducted. The two looked closely at each option, weighing their benefits and drawbacks and assessing when they might prove most useful.

The homework pays off as the annual business meeting unfolds.

Vote Type 1: General or unanimous consent vote

“This type of vote is great for noncontroversial matters,” Jones told Christensen during their prep. “It also speeds up the meeting.”

The two agreed she’d use them for the first items on the agenda: adopting the agenda for this meeting and approving the last business meeting’s minutes. She followed that plan in the meeting’s first moments.

“First, we will approve the agenda for this meeting. Are there any objections to today’s agenda as presented?” she asks. Then, as Jones coached her, she pauses and counts to three. “Hearing no objection, the agenda is approved.”

Christensen clears her throat, then leans into the podium microphone again. “Next is approving the minutes from the last business meeting. Are there any corrections to the minutes as distributed?”

Three more seconds pass with silence. “Hearing no objection, the minutes are approved,” she says.

Jones told Christensen the likelihood of objections to either of these agenda items was very small. Had one arisen, though, she would have simply resorted to a voice vote.

Vote Type 2: Voice vote

Like Jones predicted, members discussed the proposed motion from the facilities committee with zeal.

A proposed amendment to that motion—in which bids would be sought for projects involving the church’s parking lot and HVAC system, but not for repainting the children’s ministry wing—went through lengthy discussion.

After nearly 20 minutes, Christensen senses it’s time to move things along. To do so requires a motion to close debate, followed by a second to that motion, then followed by approval by a two-thirds majority. With 300 members present, Christensen opts to use a voice vote.

“All of those in favor of closing the debate on the amended motion as presented, say ‘Aye.’”

The ‘aye’s’ boom across the room.

“All opposed, say ‘No.’”

Only a smattering of ‘no’s’ arises across the sanctuary. Christensen feels confident that two-thirds voted in favor.

Now it’s time to see if enough support exists to approve the motion as amended with the children’s ministry project removed.

This time, only a majority is needed. Christensen again opts for a voice vote.

“All of those in favor of the motion as amended, say ‘Aye.’” Christensen says.

Another hearty round of ‘aye’s’ fills the sanctuary.

“All opposed, say ‘No.’”

A strong number of ‘no’s’ spread across the sanctuary, too.

It’s too close to call.

Vote Type 3: Raised hand or standing vote

During the prep, Jones told Christensen about the usefulness of a “raised hand or standing vote” option. “You use this when a voice vote is too close to call. You can also use it if you need the exact vote count noted in the meeting’s minutes,” Jones explained. “It’s a really effective way to keep things moving when the vote itself doesn’t need to be kept in secret.”

With the voice vote on the parking lot and HVAC projects too close, and no apparent need for secrecy involved with either decision, Christensen chooses a standing vote.

“The chair was uncertain, so we’ll conduct a standing vote,” she says into the microphone. “All of those in favor, please stand.”

A large contingent of individuals across the sanctuary rise.

“Please sit down,” she says. “Now, all of those opposed, please stand.”

Another sizable group rises. It’s still too close to call, even visually.

Christensen asks those standing to sit. She then asks those in favor to stand again.

Two tellers attending the meeting to count votes then proceed to count off those who are standing. Upon finishing, Christensen asks supporters to sit, then asks those opposed to stand. The two tellers then have those who are opposed count off.

The result: Those in favor measured 102, while those opposed measured 101—the closest margin possible.

“The motion as amended passes,” Christensen says.

Vote Type 4: Ballot vote

Going into the annual business meeting, Jones knew the calling of an associate pastor would need a ballot vote. Not only is it a significant decision, and one that members may not wish to openly vote about, but the church’s bylaws require at least two-thirds of those present and voting to approve a decision like this.

A ballot vote ensures an accurate and official count is taken and documented with the meeting’s minutes.

Anticipating this, Jones worked ahead of time with Russ Moore, chair of the Associate Pastor Search Committee, to review the church’s membership roll.

She made certain enough notice was provided to all members about the expected vote during the meeting. And she made certain enough ballots were created and available on the day of the meeting.

Jones also ensured the ballots were printed with the actual question and appropriate responses for members to select. It didn’t have to be fancy—it just simply read, “I am in favor of calling Karl Miller to be associate pastor of First Church,” followed by boxes with “YES” and “NO” next to them. No signature was required since the bylaws didn’t require one and the desire for secrecy weighed heavily.

Counting votes

The ballots for Miller’s candidacy were collected. Two tellers quickly went through them.

Among the 300 members present at the meeting, 256 cast votes.

Jones recalled Sarah E. Merkle’s article on voting and the formula needed for determining at least a two-thirds majority. Here, since there were 256 members present who voted, the tellers would take 256, multiply it by 2, then divide it by 3 to determine the number of votes needed for a two-thirds approval. Since the mathematical result to this formula—170.6—wasn’t a whole number, the tellers rounded up to the nearest whole number, which is 171.

Tip: The formula for determining a two-thirds majority is (N x 2)/3 where N is the number of people present who voted. When the result is not a whole number, the number is rounded up to the nearest whole number.

For Miller, the members overwhelmingly approve his call by a margin of 243 to 13.

Christensen breathes a sigh of relief, partly because of the need to get Miller started soon, and partly because the controversy with the facilities projects earlier in the meeting was much closer—and almost didn’t pass.

Part of the reason why was because the calculation for a majority vote works differently from the formula for calculating a two-thirds vote. With a majority, the number of members voting is multiplied times 0.5. If a whole number results, then a 1 gets added. If a fractional number results, then it gets rounded up to the nearest whole number.

Tip: The formula for determining a majority vote is N x 0.5, where N is the number of people voting. If a whole number results, add 1. If a fractional number results, round up to the nearest whole number.

In the facilities motion as amended, 203 people voted. Multiplied by 0.5, the result was 101.5, and rounded up to the next whole number, the figure was 102. That meant the motion barely passed.

But it passed nonetheless, and as the meeting headed toward the home stretch, Christensen and Jones believed no major obstacles remained in the way. The church’s budget information was presented well in advance, and support already existed for the variance built in for the facilities projects.

Christensen and Jones were right: A voice vote on the approval of the budget overwhelmingly passed.

The meeting finished. Pastor Hayes considered it a major success.



Sarah E. Merkle is a professional parliamentarian and presiding officer. One of five lawyers worldwide to have earned the credentials Certified Professional Parliamentarian-Teacher (CPP-T) and Professional Registered Parliamentarian (PRP), she helps boards, associations, corporations, and public bodies navigate rules applicable to governance and business meetings.

Part 2 of 4: Managing Meeting Motions

Knowing how to make—and manage—a motion is a crucial aspect of a successful church business meeting.

Editor’s Note: Managing motions during a church business meeting is essential to ensuring the meeting accomplishes its intended purposes. Continuing her look at effective business meetings through the hypothetical lens of Liz Jones, an experienced business administrator at First Church, Sarah E. Merkle explains how to plan, draft, and make a meeting motion.

This four-part series is offered in support of Merkle’s Mastering Meeting Basics.”


Liz Jones spent months preparing the agenda for First Church’s annual business meeting. As her work progressed, it became apparent that the facilities committee’s report would suggest more potential work would be needed than just repaving the church’s parking lot.

One motion—and possibly more—would likely come up for facilities-related needs.

Cindy Martinez, the facilities committee’s chair, sent an email to Jones several weeks prior to the meeting warning her as much.

Martinez detailed the parking lot project. She also relayed desires from some individuals to repaint the children’s ministry wing, as well as preliminary concerns from others about the church’s aging HVAC system (though some contend the concerns are premature).

The primary tension point? Next year’s proposed annual budget doesn’t account for the expenses to do all three.

“We already know there will be differing opinions about which projects need to be addressed, and which should get priority,” Martinez wrote to Jones. “At least a few also believe the church should borrow some money now and do all three projects, with the goal to have the loan paid off in two years.”

Planning the motion

Working through Sarah E. Merkle’s article on motions, Jones decides the smart approach will be to have Martinez present the facilities committee report, including the three possible projects. But Jones gets nervous about the ensuing discussion and how things might bog down in the meeting.

She again reaches out to Merkle with an email. Merkle replied soon after, reminding her she couldn’t provide legal advice but could generally help.

“In general, it’s smart to come to a meeting with a proposed motion drafted,” Merkle wrote. “You don’t want all the information presented about all the projects, say all three need to happen, and stop there. At that point, someone will just present a motion that isn’t well-crafted.”

Jones confers with the finance committee chair, Alex Armstrong, about how next year’s annual budget is taking shape. He tells her a potentially reasonable budget amount for the developing projects based on current financial projections, pending bids for the projects.

Jones then proceeds to help Martinez craft a draft motion that reads as follows:

RESOLVED, that the Facilities Committee obtain bids to begin the following capital projects during the next fiscal year:

  • Repave the parking lot;
  • Replace the HVAC system;
  • Repaint the children’s ministry wing; and,

that the Facilities Committee be authorized to proceed with these projects, provided they do not exceed a combined total cost of $200,000.

Making the motion

The annual business meeting day arrives and 300 voting members show up, more than enough to satisfy the quorum requirement for First Church’s annual business meeting.

As planned, the agenda begins with the ministries, financial health, and facilities reports.

The ministries report includes exciting developments for First Church, such as big growth in its children’s ministry and a new missions opportunity in Ecuador.

Armstrong’s financial health report reads mostly positive, too. First Church’s only debt is the loan it received to purchase its building and property from another church about seven years ago. Giving over the past year remained steady, a welcome development after years of local and national economic uncertainty.

Then it’s Martinez’s turn to provide her committee’s report on the facilities. She references the packet of information sent out to members a couple of weeks before the meeting.

Martinez uses the PowerPoint that Jones helped create to provide descriptions and photos detailing the parking lot’s rapid deterioration, which was already evident when First Church bought the property seven years ago. She also explains the children’s ministry’s growth, and the children’s ministry director’s desire to freshen things up. Then she discusses some of the HVAC system’s recent problems, including an unexpected breakdown last winter that left the building colder than usual for worship one Sunday.

Martinez finishes and makes the motion that Jones helped her prepare. Since it comes from the committee, the motion doesn’t require anyone to second it.

“Is there any discussion?” asks Terry Christensen, the church’s board chairwoman.

Jones shifts uncomfortably in her first-row seat. This would be the first opportunity for the meeting to go off the rails.

Lively discussion

The discussion was as lively as Jones and Martinez anticipated. Thankfully they warned Christensen ahead of time so that presiding over it wouldn’t surprise her.

Some members express immediate opposition to the repainting. “The wing doesn’t look that bad, and the money should be used for the HVAC,” an older man opines.

Another member jumps in: “I move we strike the children’s ministry wing repainting from the motion.”

“Is there a second to the amendment?” Christensen asks. Since the amendment didn’t come from the committee, a second to this motion is needed. The older man seconds the motion.

“Is there discussion about the amendment?” Christensen asks.

A young mother raises her hand. “I know repainting may seem unnecessary. But we’ve heard about how the children’s ministry has grown,” she says. “Anyone who serves downstairs knows how dingy everything looks.”

Other members speak up. Some support the repainting. Others oppose it. One suggests doing all three but borrowing money, which elicits a somewhat snarky response from a longtime member who boasts how the church has historically avoided debt beyond its mortgage. Eventually, a majority votes to adopt the amendment.

Discussion then resumes on the motion as amended. Nearly 20 minutes pass. Sensing it’s time to move things along, a longtime member makes a motion to close debate that gets seconded and then approved by a two-thirds majority of the votes cast.

Now it’s time to see if enough support exists to approve the motion as amended with the children’s ministry project removed. Another voice vote must be done, but this time, only a majority is needed to approve it.



Sarah E. Merkle is a professional parliamentarian and presiding officer. One of five lawyers worldwide to have earned the credentials Certified Professional Parliamentarian-Teacher (CPP-T) and Professional Registered Parliamentarian (PRP), she helps boards, associations, corporations, and public bodies navigate rules applicable to governance and business meetings.

Four Steps Needed For An Effective Church Meeting

Parliamentarian Sarah E. Merkle partners with Church Law & Tax to show church leaders how to hold an effective church meeting.

Church Law & Tax Senior Editorial Advisor Sarah E. Merkle understands the importance of planning and holding an effective church meeting.

“Many church members and leaders don’t know the risk to churches that do not understand parliamentary procedure or carefully follow it,” Merkle says. “There can be legal implications for not keeping minutes of actions taken by the church. Churches that don’t think through quorum or are careless about voting or the election of officers will often find themselves in a procedural mess. And spiritually, a congregation may experience strife and contention if there is a lack of good leadership or poor member involvement in church business. Avoid problems by following principles of parliamentary procedure and good governance.”

In this companion to “Mastering Meeting Basics,” Merkle offers this hypothetical case study, a four-part series on how to plan, hold, and document an effective church meeting. From planning the meeting to making motions, and from taking votes to capturing minutes, this series can offer valuable insights.

Any church leader responsible for planning and holding effective church meetings should bookmark this resource.


Key Tax Dates June 2023

Key tax dates in June include housing allowance designations, quarterly payments, and monthly or semiweekly requirements.

Monthly requirements

If your church or organization reported withheld taxes of $50,000 or less during the most recent lookback period (for 2023 the lookback period is July 1, 2021, through June 30, 2022), then withheld payroll taxes are deposited monthly.

Monthly deposits are due by the 15th day of the following month. Note, however, that if withheld taxes are less than $2,500 at the end of any calendar quarter (March 31, June 30, September 30, or December 31), the church or organization need not deposit the taxes.

Tip: The 2023 Church & Clergy Tax Guide is available—order a print copy today (while supplies last) or download the .pdf version now.

Instead, it can pay the total withheld taxes directly to the IRS with its quarterly Form 941. Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes (7.65 percent of wages), and the employer’s share of Social Security and Medicare taxes (an additional 7.65 percent of employee wages).

Semiweekly requirements

If your church or organization reported withheld taxes of more than $50,000 during the most recent lookback period (for 2023 the lookback period is July 1, 2021, through June 30, 2022), then the withheld payroll taxes are deposited semiweekly.

For paydays falling on Wednesday, Thursday, or Friday, the payroll taxes must be deposited on or by the following Wednesday.

For all other paydays, the payroll taxes must be deposited on the Friday following the payday.

Large employers having withheld taxes of $100,000 or more at the end of any day must deposit the taxes by the next banking day. The deposit days are based on the timing of the employer’s payroll. Withheld taxes include federal income taxes withheld from employee wages, the employee’s share of Social Security and Medicare taxes (7.65 percent of wages), and the employer’s share of Social Security and Medicare taxes (an additional 7.65 percent of employee wages).

June 15, 2023: Quarterly estimated tax payments for certain employees and churches

Filing for certain ministers and self-employed workers

Ministers who have not elected voluntary withholding and self-employed workers must file their second quarterly estimated federal tax payment for 2023 by June 15. A similar rule applies in many states to payments of estimated state taxes.

Nonminister employees of churches that filed a timely Form 8274 (waiving the church’s obligation to withhold and pay FICA taxes) are treated as self-employed for Social Security. They are subject to the estimated tax deadlines with respect to their self-employment (Social Security) taxes unless they ask their employing church to withhold an additional amount of income taxes from each paycheck that will be sufficient to cover self-employment taxes (use a new Form W-4, Step 4(c), to make this request).

Payments for unrelated business income tax liability

A church must make quarterly estimated tax payments if it expects an unrelated business income tax liability for the year to be $500 or more. Use IRS Form 990-W to figure your estimated taxes. Quarterly estimated tax payments of one-fourth of the total tax liability are due by April 15, June 15, September 15, and December 15, 2023, for churches on a calendar-year basis. Deposit quarterly tax payments electronically using the Electronic Federal Tax Payment System (EFTPS).

June 30, 2023: Review housing or parsonage allowance designations

Now is a good time to review the 2023 housing or parsonage allowances designated for all ministers on staff. If an allowance designated for 2023 is clearly below actual housing expenses, then the church board should consider declaring a larger portion of the minister’s remaining compensation as a housing or parsonage allowance.

A church is free to designate any portion of a minister’s compensation as a housing allowance but remember that clergy who own their home cannot claim a housing allowance exclusion greater than the fair rental value of the home (furnished, including utilities).

Therefore, the allowance ordinarily should not be significantly more than this amount.

Note: If a date listed for filing a return or making a tax payment falls on a Saturday, Sunday, or legal holiday (either national or statewide in a state where the return is required to be filed), the return or tax payment is due on the following business day.

Note: You must use electronic funds transfer to make all federal employment tax deposits. This is generally done using the Electronic Federal Tax Payment System, a free service provided by the US Department of Treasury. If you don’t wish to use EFTPS, you can arrange for your tax professional, financial institution, or payroll service to make deposits on your behalf. Failure to make a timely deposit may subject you to a 10-percent penalty.

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.
ajax-loader-largecaret-downcloseHamburger Menuicon_amazonApple PodcastsBio Iconicon_cards_grid_caretChild Abuse Reporting Laws by State IconChurchSalary Iconicon_facebookGoogle Podcastsicon_instagramLegal Library IconLegal Library Iconicon_linkedinLock IconMegaphone IconOnline Learning IconPodcast IconRecent Legal Developments IconRecommended Reading IconRSS IconSubmiticon_select-arrowSpotify IconAlaska State MapAlabama State MapArkansas State MapArizona State MapCalifornia State MapColorado State MapConnecticut State MapWashington DC State MapDelaware State MapFederal MapFlorida State MapGeorgia State MapHawaii State MapIowa State MapIdaho State MapIllinois State MapIndiana State MapKansas State MapKentucky State MapLouisiana State MapMassachusetts State MapMaryland State MapMaine State MapMichigan State MapMinnesota State MapMissouri State MapMississippi State MapMontana State MapMulti State MapNorth Carolina State MapNorth Dakota State MapNebraska State MapNew Hampshire State MapNew Jersey State MapNew Mexico IconNevada State MapNew York State MapOhio State MapOklahoma State MapOregon State MapPennsylvania State MapRhode Island State MapSouth Carolina State MapSouth Dakota State MapTennessee State MapTexas State MapUtah State MapVirginia State MapVermont State MapWashington State MapWisconsin State MapWest Virginia State MapWyoming State IconShopping Cart IconTax Calendar Iconicon_twitteryoutubepauseplay
caret-downclosefacebook-squarehamburgerinstagram-squarelinkedin-squarepauseplaytwitter-square