In the United States, 501(c)(3) incorporation is generally used by churches and other nonprofits as a legal structure under which they operate. However, some Christians and churches wonder whether it is biblical to seek 501(c)(3) incorporation.
Is it biblically acceptable for a church to seek 501(c)(3) incorporation?
501(c)(3) nonprofit status or anything similar to it did not exist during the New Testament period. There are no biblical commands that require a church becomes a legal nonprofit under this structure. However, any nonprofit group that intends to grow and maintain a regular structure that includes bank accounts and donor reporting must choose some legal structure under which to operate legally.
In Matthew 22:21, in talking about paying taxes, Jesus taught to give to Caesar what is Caesar's, and to God what is God's. In Matthew 17:24-27, Jesus told Peter he would find a coin in the mouth of the first fish he caught that was to be used to pay for their Jewish temple tax.
John the Baptist also taught repentant tax collectors only to, "Collect no more than you are authorized to do" (Luke 3:13). Romans 13 affirms the importance of obeying the laws of one's culture. In all of these cases, we find ample evidence to support working within the laws of one's society to operate in a legal and ethical manner.
Some have argued against nonprofit incorporation based on 1 Corinthians 7:23 that states, "You were bought with a price; do not become bondservants of men." However, this verse cannot be properly applied to this topic. This passage dealt with the concept of human slavery rather than church organization.
The benefits of incorporation include the ability to offer tax deductible giving to church members, as well as nonprofit status for the church. Some see incorporation as negative, however, thinking it limits the ability of the church to speak out on sensitive politic issues. While this could become a potential future problem, churches should not generally fear this issue. Churches have been able to speak out on all sorts of issues throughout American history and have not experienced problems with their nonprofit status.
What if government someday requires an action that is at odds with biblical commands? Acts 5:29 is clear, "We must obey God rather than men"! However, except in such a case, there should be no reason to generally fear applying for nonprofit status as a church.
For those who still have concerns, there is also the option of a 508(c)(1)(a) tax-exempt nonprofit status. Those with questions regarding the appropriate choice for their church should consult a nonprofit attorney regarding legal issues and any particular concerns regarding one's own state.
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