Q&A: Inspecting Church Contribution Records
Can pastors and board members review what people give?

Can a senior pastor and members of the church board inspect the contribution records of each member?

This is a controversial question. Consider five factors:

Why would a pastor and church board want to inspect the contribution records of members? One reason might be to enforce a bylaw requirement that members in good standing "Tithe" or make some other specified financial commitment to the church. However, it is far more common for church bylaws to require that members "support the church financially," and this is an ambiguous standard that would not warrant accessing individual members' contribution records.

Many pastors do not want to see donor records since they do not want this information to influence their relationship with individual members. The nonprofit corporation statutes of most states give members of incorporated churches the legal right to inspect various corporate records. However, individual donor records generally are not included among those records that can be inspected.

A few years ago the Texas Supreme Court ruled that a nonprofit corporation law did not confer any authority to inspect the contribution records of individual members. The Texas Nonprofit Corporation Act specifies that "all records, books, and annual reports of the financial activity of the corporation shall be kept at the registered office or principal office of the corporation … and shall be available to the public for inspection and copying there during normal business hours."

Based on this provision, a group of persons demanded that a charity turn over documents revealing the identities of donors and the amounts of their annual contributions. The charity resisted this request, claiming that the inspection right provided under the nonprofit corporation law did not refer to inspection or disclosure of donor lists, and even if it did, such a provision would violate the First Amendment freedom of association.

The court ruled that the right of inspection or disclosure of donor lists didn't exist, and even if it did, such a provision would violate the First Amendment freedom of association. The court ruled that the right of inspection did not extend to donor lists. It noted that "the statute does not expressly require that contributors' identities be made available to the public." And, it found that the intent of the legislature in enacting the inspection right "was not to force nonprofit corporations to identify the exact sources of their income; rather, it was to expose the nature of the expenditures of that money once received from the public and to make nonprofit organizations accountable to their contributors for those expenditures." As a result, the statute "can be upheld as constitutional when interpreted as not requiring disclosure of contributors' names."

If a state's nonprofit corporation law does not specifically authorize pastors and board members to inspect individual members' contribution records, then such a practice could expose the church to possible liability for invasion of privacy. While this risk may be remote, it should not be ignored.

In the final analysis, the question comes down to the membership requirements in the church's governing documents. If a church's bylaws mandate tithing or some other specified level of financial commitment, then there would be stronger justification for the senior pastor, and possibly the church board, to access individual donor records in order to enforce the membership requirement. Of course, if the church bylaws require a specific financial commitment, and the pastor or members of the board inspect the contribution records of individual members in order to enforce this requirement, this means that members who fail to satisfy the contribution requirement may need to be suspended or dismissed from the active voting roll. Obviously, this would be a highly controversial action in many churches. Also, in order to determine whether individual members are in fact complying with a contribution requirement, a church would need to have access to members' tax returns so that an accurate judgment could be made regarding their compliance with the membership requirements. This is the only realistic way that this can be enforced. There is no way that a church's contribution records, by themselves, will indicate compliance with a minimum contribution requirement in most cases.

Few churches would want to make a specified financial commitment a requirement of church membership in light of these consequences and ramifications. And, if a specified financial commitment is not a membership requirement, then there is little if any justification for the senior pastor or board members having access to members' contribution records.

Richard R. Hammar is an attorney, CPA, and best-selling author specializing in legal and tax issues for churches and clergy. A graduate of Harvard Law School, he is the author of more than 100 books, including Pastor, Church & Law and the annual Church and Clergy Tax Guide .

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