On the topic of ministry ordain - ordination practices, you should understand a very important matter. There is a very important reason that the process of ordination must be carefully overseen; It plays a prominent role on IRS Form 1023, the application that a church may elect to file to secure recognition of its tax exempt status under section 501c3 of the Internal Revenue Code.

Eventually, ordained clergy will file personal tax returns claiming the special tax benefits available only to ministers who are duly ordained pursuant to a bona fide ordination process. In the event of an audit, notwithstanding a “minister’s” claims to the contrary, the information provided by a church in response to the questions regarding the process of how ministry ordain - ordination is carried out, will be controlling.

For example, a church that is submitting a 501c3 application may represent that its ministers will be ordained: (i) after completing a prescribed course of study, (ii) and only into the pastoral ministry, (iii) to oversee a congregation, or a substantial part of a large congregation (say 200 members or more), and (iv) perform sacerdotal functions, and administer the sacraments. This is clearly representative of the ordination processes of many churches.

But suppose that one of the applicant’s “ministers” later claims a part of his salary as an exclusion from gross income because it represents a “housing allowance.” However, this “minister” has never served in the pastoral ministry. Perhaps he was “ordained” on paper and “authorized” to administer the sacraments and perform sacerdotal functions. But his actual duties (those for which he was hired and received a salary) did not entail those functions.

Therefore, he rarely if ever administered sacraments or performed sacerdotal functions. And he is not generally considered a religious leader of the church or denomination. In fact, the “minister” was hired into the administration of the church as an accountant or an attorney, and those are the only duties he was paid for. He was never hired into the pastoral ministry. Unfortunately, this is not a rare occurrence in the ministry ordain - ordination practices of some churches.

What’s the bottom line? Even if the applicant church intended to “ordain” that individual (which has happened, but often for the illegitimate purpose of helping the individual take advantage of special tax privileges for ministers), the ordination process was not in compliance with its official representations on Form 1023. And that’s besides the fact that there may have been an illegitimate motive.

If you are starting a church, or helping someone else to do so, this is a very important area of church tax law you must become familiar with. For the gold standard in use today by hundreds of church start-ups throughout the country, you owe it to yourself to take a close look at Building On Faith: Everything You Need To Know About Starting Your Own Church. It's authored by Abe Hernandez, Esq., a devoted Christian and church law expert.