508

Are you discovering that your 501c3 organization is compromised by its dependence upon and obligations to the State? Are you concerned about the vulnerability of its bank accounts? Do you want to insure and protect its financial privacy? Are unneccessary commercial restrictions impinging on its ability to perform its mission?

To preserve the separation of church and state, a 508 non-profit religious organization is the proper designation for a church or a fellowship or a mission or a ministry.

Other than the articles of incorporation, annual reports and an EIN which is procured for banking purposes only, a church should not contract with the state. To remain free, the church should never apply for permits, licenses, grants or exemptions; nor should it ever receive 1099s. The only revenue it should ever receive is donations. It can give but should never receive charity.

A 508 church can be donated and own anything: $$$s, vehicles, property, etc.

A 508 church can be the sole owner of a 501c3 (which can apply for grants) or an LLC. CPAs know it as a pass through account with the church on top. The LLC can have employees and earn profit; and, donate whatever whenever it wants to the church. The LLC gets a tax write off and the 508 church doesn't report to anybody.

The church has a mission statement and its by-laws are its minutes documents, one document per matter through time. It is run by a board which includes a president and a secretary. Normally, both officers are signatories on bank accounts.

Banks require driver's licenses and SSNs of all signatories. The account itself, however, is identified only by its name and EIN.

Here are responses to some bank questions one may encounter in setting up accounts:
Is Entity registered to do business in _____? NO.
In what state(s) are you registered? None. Not doing business.
Nature of business: Non-profit religious corporation, church, non-501c3.
What is the primary source of funds for the account? Donations only.
What is the purpose of this account? (operating, payroll, etc.) Banking Purposes only.
The following information for each individual, if any, who directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, owns 25 percent or more of the equity interests of the legal entity listed above (if owned by trust, trustees are considered owners): None.

Whereas 501c3 'churches' are under the thumb of the IRS, 508 Non-Profit Religious Corporations are outside any authority other than God. See: Exception vs. Exemption

501(c)3

501(c)3s are created by the government and owe their servitude to the government. Their tax immune status is obtained, not naturally inherent. They are charity corporations which are organized for benevolent purposes; not churches.

Benefits of 501(c)3 status include:
† They pay no federal, state, or local taxes;
† They qualify for special grants and government funding, even lower postage rates;
† They are able to encourage donation by providing donors with tax deduction; † They shield owners and directors from liability through status as a corporation; and
† They're eligible for discounted advertising rates, including possible free tv and radio public service announcements (PSA’s).

Drawbacks of 501(c)3 status include:
† They requite a lengthy, involved application and qualification process that requires payment of multiple fees and costs;
† They must comply with numerous regulatory requirements, including submitting annual reports to federal and state agencies; and
† IRS regulates what 501(c)3s say.

501(c)3 Exemption: 26 USC § 501 - Exemption from tax on corporations, certain trusts, etc.; 26 USC § 6033 - Returns by exempt organizations
Why not?; Facts; Chuck Baldwin: State-Owned Churches Are Killing America, 2/3/11; 30 Pieces of Silver: An indictment of American Churches, 10/6/12; Does Your Pastor Serve God or the Global Elite?, 10/28/12; Save Your Soul By Leaving Your Government Controlled Church, 10/21/13; No 501-C-3 Church Can Be a Church of God, 1/2/14; Why the Church Must Be Abandoned, 2/13/14; Is Your Church Part of the New World Order?, 7/13/14; State-Run Churches Caught Red Handed, 8/11/14; Pastors And Churches Violating First Commandment, 8/29/14; Faith-Based Fascism: Turning Churches into the State's Bagmen, 9/4/14; Idaho city’s ordinance tells pastors to marry gays or go to jail, 10/20/14; When Your Church Becomes a Place of Statist Worship, 12/3/14; DHS, FEMA & THE EPA HAVE TAKEN OVER YOUR CHURCH, 12/4/14; Will Freedom Survive 2015?, 1/15/15; Church Asks Followers to Submit to Government, Call 911 on Suspicious Neighbors, 2/9/15; Next Tool of Tyranny & Enslavement Is Coming From Your Pastor & FEMA, 9/10/15; What Separation Of Church And State?, 10/1/15; Getting Taxpayer-Funded Free Stuff Is Not "Religious Liberty", 7/2/17; California launches an attack against churches!?, 4/19/18

508

Church and State are separate realms. A 508 is the proper designation for a church. It's tax immune status is naturally inherent, therefore, it is not required to file a tax return.

508s have no obligation to report to any government agencies.

508s cannot have employees, nor can they get government grants.

508(c)(1)(a) Exception: 26 USC § 508 - Special rules with respect to; 26 USC § 6033 (a) (3) - Exceptions from filing

Exception vs. Exemption

The difference between a 508(C)(1)(a) Exception and a 501(C)(3) Exemption is rather startling.

EXEMPT. To release, discharge, waive, relieve from liability. To relieve, excuse, or set free from a duty or service imposed upon the general class to which the individual exempted belongs; as to exempt from military service. To relieve certain classes of property from liability to sale on execution, or from taxation, or from bankruptcy or attachment.

EXCEPTION. Act of excepting or excluding from a number designated or from a description; that which is excepted or separated from others in a general rule or description; a person, thing, or case specified as distinct or not included; an act of excepting, omitting from mention or leaving out of consideration. Express exclusion of something from operation of contract or deed. An "exception" operates to take something out of thing granted which would otherwise pass or be included. Christman v. Emineth, N.D., 212 N.W.2d 543, 552.

And further: An exception in a statute is a clause designed to reserve or exempt some individuals from the general class of persons or things to which the language of the act in general attaches. The office of an "exception" in a statute is to except something from the operative effect of a statute or to qualify or restrain the generality of the substantive enactment to which it is attached, and it is not necessarily limited to the section of the statute immediately following or preceding. Gatliff Coal Co. v. Cox, C.C.A. Ky., 142 F.2d 876, 882 [both of the above definitions come from Black's Fifth Edition]

In other words, the rules are bent when dealing with an exemption, but the rules simply DO NOT APPLY to someone who was never placed on the list, i.e., - excepted. The inclusion of the word "mandatory" in section 508(C)(1)(a) adds a little weight, and it sounds like weight of law. Because this is the U.S. Code, not CFR, this means that the law can ONLY apply to government agencies or employees.

The USC is law for government personnel, but only CFR can be applied to U.S. citizens [26 USC 7805]. The IRS rules cannot be mandatory upon 508s because Section 508(C)(1)(a) stipulates that the tax laws have absolutely nothing to do with them. The only way that you can make them mandatory is by volunteering.

Feel free to contact us if you want to know more.

Oregon Religious Non-Profit Corporations are excepted from record keeping regulations and have no obligation to report to any State or Federal agencies. Their officers hold no stock. Their EIN is set up ‘for Banking Purposes Only”. Their records are for private use and there is no need for their Minutes to be notarized or recorded anywhere other than their own Board’s records.

Still, it is important to maintain Minutes for every decision your 508 organization makes. Keep them simple and every topic separate. These Minutes are the law for your church.

Stay in compliance. The Board must always have at least two officers and must abide by religious and humanitarian intent. The purpose of the Board is to protect the church. Keep the organization’s physical address up to date with the organization’s registered agent for proper filing of Annual Reports.

In addition to Minutes documents, church calendars and/or diary can be useful to compile, as well.

If ever need be, officers always have the availability of responding to any presentment with a Commercial Affidavit with Exhibits – the exhibits being whichever Minutes, etc. are appropriate to whatever matter is at hand.

MINUTES OF INITIAL POST-ORGANIZATIONAL MEETING
OF THE BOARD OF DIRECTORS FOR
GARDEN MINISTRIES

TIME AND PLACE: The initial post-organizational meeting of the Board of Directors as appointed by the Incorporator and Registered Agent of GARDEN MINISTRIES was held at 2711 Terrapin Lane, Missoula, MT 58901 at 11am on the 2nd day of September 2021 pursuant to a waiver of notice signed by each of the Directors.

PRESENT: Debra Doe presided over the meeting and Carl Doe acted as Secretary of the post-organizational meeting. The Waiver of Notice was presented to the meeting and was ordered filed with the minutes of the meeting.

ARTICLES OF INCORPORATION: The Secretary reported that the Corporation’s Articles of Incorporation had been filed in the office of the Corporation Commission of the State of Oregon on the 29th day of August 2021, bearing the approval of the Oregon Secretary of State. The Secretary was instructed to place a copy of the Articles of Incorporation in the minutes book of the Corporation.

BOARD OF DIRECTORS: The meeting was declared open for discussion; and, upon motion duly made and seconded, the following directors were unanimously appointed to serve until the next annual meeting or until their respective successors are elected and qualified:

President: Debra Doe
Secretary: Carl Doe

BANK ACCOUNT: President affirmed she will determine which banks are to service the corporation accounts, open such accounts and write checks and conduct corporate business with said accounts.

There being no further business to come before the meeting, the meeting was adjourned.

ATTEST: Member Board of Directors _Debra Doe signature____________________

Member Board of Directors _Carl Doe signature___________________

MINUTES OF MEETING (Sample #2)
OF THE BOARD OF DIRECTORS FOR
HAPPY VALLEY MISSION

TIME AND PLACE: The meeting of the Board of Directors of HAPPY VALLEY MISSION was held at 1109 Baines Street, Selma, AL 36702, at 11:00 AM on the 11th day of September, 2016.

PRESENT Cynthia Peaks presided over the meeting and Harold Rains was Secretary of the Meeting of the Board of Directors.

ACTIVITIES OF BOARD OF DIRECTORS: The meeting was declared open for activities the board was to agree on.

After discussion, upon motion duly made and seconded, the following activities were approved by the Board Members:

If agencies outside of HAPPY VALLEY MISSION request records or any other sensitive information the Board would need to meet and decide to either allow or disallow the action.

There being no further business to come before the meeting, the meeting was adjourned.

ATTEST: Member Board of Directors __Cynthia Peaks____________

Member Board of Directors __Harold Rains_______________

MINUTES OF MEETING (Sample #3)
OF THE BOARD OF DIRECTORS FOR
HAPPY VALLEY MISSION

TIME AND PLACE: The meeting of the Board of Directors of HAPPY VALLEY MISSION was held at 1109 Baines Street, Selma, AL 36702, at 11:00 AM on the 11th day of September, 2016.

PRESENT Cynthia Peaks presided over the meeting and Harold Rains was Secretary of the Meeting of the Board of Directors.

ACTIVITIES OF BOARD OF DIRECTORS: The meeting was declared open for activities the board was to agree on.

After discussion, upon motion duly made and seconded, the following activities were approved by the Board Members:

Harold Rains is to be placed on the HAPPY VALLEY MISSION checking account as a signer and receive a debit card.

There being no further business to come before the meeting, the meeting was adjourned.

ATTEST: Member Board of Directors __Cynthia Peaks____________

Member Board of Directors __Harold Rains_______________

MINUTES OF MEETING (Sample #4)
OF THE BOARD OF DIRECTORS FOR
HAPPY VALLEY MISSION

TIME AND PLACE: The meeting of the Board of Directors of HAPPY VALLEY MISSION was held at 1109 Baines Street, Selma, AL 36702, at 11:00 AM on the 11th day of September, 2016.

PRESENT Cynthia Peaks presided over the meeting and Harold Rains was Secretary of the Meeting of the Board of Directors.

ACTIVITIES OF BOARD OF DIRECTORS: The meeting was declared open for activities the board was to agree on.

After discussion, upon motion duly made and seconded, the following activities were approved by the Board Members:

Harold Rains was appointed to the board.

There being no further business to come before the meeting, the meeting was adjourned.

508 Non-Profit Religious Corporation

501(c)3

508

Exception vs. Exemption

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