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Nonregistered Baptist Bible Fellowship Meeting Videos:
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2024: https://www.youtube.com/playlist?list=PLeRgjjDtuconUZhEjBJRSyKztHuHsj_vX
https://www.youtube.com/playlist?list=PLeRgjjDtucolKuqTJt5k7Yet5JxgVOqMu
2024: https://www.youtube.com/playlist?list=PLeRgjjDtuconUZhEjBJRSyKztHuHsj_vX
Scriptures that oppose the present state licensing and government incorporation of Bible believing churches, which would otherwise have been held in lawful possession by Jesus Christ!
Matthew 5:34 But I say unto you, swear not at all; ...
Matthew 6:1-4 Do no almsgiving before men, but do so in secret
Matthew 6:24 You cannot serve both God and mammon
Matthew 10:34 I am not come to bring peace, but a sword
Matthew 16:23 Thou art an offence unto me : for thou savourest not the things that be of God, but those that be of men.
John 2:19 The church is not a building
Acts 4:19 Better to obey God or to obey men?
Acts 19:24-27 If they dis-incorporate, they will lose their wealth
Romans 6:16-23 (John 8:34) Servants ye are to whom ye yield
Romans 12:1-21 Saints relate in Divine Grace, not government "graces," "privileges," or "protections"
1 Corinthians 6:1-20 Believers go to law before unbelievers? ...one joined to a harlot is one with her
1 Corinthians 7:23 Be ye not the servants of men
1 Corinthians 10:14-23 They who eat the sacrifices of the altar are 'incorporated' into the altar
1 Corinthians 12:27-28 Paul does not list civil magistrate as a church officer
2 Corinthians 6:14-16 Be ye not unequally yoked together with unbelievers
Galatians 6:7-8 Whatsoever a man soweth, that shall he also reap
Colossians 3:9-10 Man's nature is renewed after the likeness of the entity which (re)created him
James 5:12 Swear not, ...lest ye fall into condemnation
1 Peter 1:18 Not redeemed with corruptible things
2 Peter 2:18-20 They promise liberty, but are full of corruption
Exodus 23:32 Thou shalt make no [Marriage?] covenant with them, nor with their gods
II Samuel 23:3 He that ruleth over men must be just, ruling in the fear of God
Psalm 94:20 Iniquity ...which frameth mischief by a law?
Proverbs 23:1-3 Be not desirous of dainties: for they are deceitful
Isaiah 30:1-3 Woe to the rebellious children ...that they may add sin to sin ...and trust in the shadow of Egypt
Isaiah 36:6 Lo, thou trustest in ...Egypt: whereon if a man lean, it will go into his hand, and pierce it:
Daniel 7:21-22 And the saints possessed the kingdom -Who is in possession of whom TODAY?
Amos 7:13 It is the king's chapel, and the king's court
In spite of all these verses, many persist in claiming that God still honors them in their 501 (c) (3) charity counterfeit, that His work is still done, the Word is preached and people are still saved. But God says in Isaiah 43:24 "...thou hast made me to serve with thy sins, thou hast wearied me with thine iniquities."
"Cursed be he that doeth the work of the Lord deceitfully..." Jeremiah 48:10
Should those of us called to love the Lord and serve Him only, be content to receive gifts through having extorted the Lord's cooperation? Can you continue in sin and expect grace to abound (Romans 6:1)?
Church Incorporation (licensure) under USC Title 26, Section 501 (c) (3) violates the previous scriptures, and is therefore sin and unlawful in the Supreme Court of the Divine Lawgiver!
The U S Supreme Court's position on Corporations
Hale v. Henkel 201 U.S. 43, 74 (1906)
"Upon the other hand, the corporation is a creature of the state. It is presumed to be incorporated for the benefit of the public. It receives certain privileges and franchises, and holds them subject to the laws of the state and the limitations of its charter. Its powers are limited by law. It can make no contract not authorized by its charter. Its rights to act as a corporation are only preserved to it so long as it obeys the laws of its creation. There is a reserved right in the legislature to investigate its contracts and find out whether it has exceeded its powers. It would be a strange anomaly to hold that a state, having chartered a corporation to make use of certain franchises, could not, in exercise of its sovereignty, inquire how these franchises had been employed, and whether they had been abused, and demand the production of the corporate books and papers for that purpose. The defense amounts to this: That an officer of a corporation which is charged with a criminal violation of the statute, may plead the criminality of such corporation as a refusal to produce its books. To state this proposition is to answer it. While an individual may lawfully refuse to answer incriminating questions unless protected by an immunity statute, it does not follow that a corporation, vested with special privileges and franchises, may refuse to show its hand when charged with an abuse of such privileges."
In other words as a public charity the institution is in partnership with the state. As such it forfeits all rights to act as God's sanctuary. So, how many times must it be stated that a "church" which selects incorporated status under state or federal venue is, in law and in fact, a bona fide creation of government? This means that it is legally a state institution, placed in possession of special, state statutory privileges and obligations. The government is the definite "sovereign" to the corporations, and all artificial entities, and persons which it creates. Where in the Bible does it describe the Body of Christ, along with its tithes and offerings (which are supposedly "freely given" without duplicity) as an "artificial person?"
A Dictator's Definition: a quote from former Italian dictator Benito Mussolini on his strategy to manage the people and government of Italy via corporations. "Fascism should more properly be called corporatism because it is the merger of state and corporate power" (The "Encyclopedia Italiana," Giovanni Gentile, editor; late 1930's)
Matthew 5:34 But I say unto you, swear not at all; ...
Matthew 6:1-4 Do no almsgiving before men, but do so in secret
Matthew 6:24 You cannot serve both God and mammon
Matthew 10:34 I am not come to bring peace, but a sword
Matthew 16:23 Thou art an offence unto me : for thou savourest not the things that be of God, but those that be of men.
John 2:19 The church is not a building
Acts 4:19 Better to obey God or to obey men?
Acts 19:24-27 If they dis-incorporate, they will lose their wealth
Romans 6:16-23 (John 8:34) Servants ye are to whom ye yield
Romans 12:1-21 Saints relate in Divine Grace, not government "graces," "privileges," or "protections"
1 Corinthians 6:1-20 Believers go to law before unbelievers? ...one joined to a harlot is one with her
1 Corinthians 7:23 Be ye not the servants of men
1 Corinthians 10:14-23 They who eat the sacrifices of the altar are 'incorporated' into the altar
1 Corinthians 12:27-28 Paul does not list civil magistrate as a church officer
2 Corinthians 6:14-16 Be ye not unequally yoked together with unbelievers
Galatians 6:7-8 Whatsoever a man soweth, that shall he also reap
Colossians 3:9-10 Man's nature is renewed after the likeness of the entity which (re)created him
James 5:12 Swear not, ...lest ye fall into condemnation
1 Peter 1:18 Not redeemed with corruptible things
2 Peter 2:18-20 They promise liberty, but are full of corruption
Exodus 23:32 Thou shalt make no [Marriage?] covenant with them, nor with their gods
II Samuel 23:3 He that ruleth over men must be just, ruling in the fear of God
Psalm 94:20 Iniquity ...which frameth mischief by a law?
Proverbs 23:1-3 Be not desirous of dainties: for they are deceitful
Isaiah 30:1-3 Woe to the rebellious children ...that they may add sin to sin ...and trust in the shadow of Egypt
Isaiah 36:6 Lo, thou trustest in ...Egypt: whereon if a man lean, it will go into his hand, and pierce it:
Daniel 7:21-22 And the saints possessed the kingdom -Who is in possession of whom TODAY?
Amos 7:13 It is the king's chapel, and the king's court
In spite of all these verses, many persist in claiming that God still honors them in their 501 (c) (3) charity counterfeit, that His work is still done, the Word is preached and people are still saved. But God says in Isaiah 43:24 "...thou hast made me to serve with thy sins, thou hast wearied me with thine iniquities."
"Cursed be he that doeth the work of the Lord deceitfully..." Jeremiah 48:10
Should those of us called to love the Lord and serve Him only, be content to receive gifts through having extorted the Lord's cooperation? Can you continue in sin and expect grace to abound (Romans 6:1)?
Church Incorporation (licensure) under USC Title 26, Section 501 (c) (3) violates the previous scriptures, and is therefore sin and unlawful in the Supreme Court of the Divine Lawgiver!
The U S Supreme Court's position on Corporations
Hale v. Henkel 201 U.S. 43, 74 (1906)
"Upon the other hand, the corporation is a creature of the state. It is presumed to be incorporated for the benefit of the public. It receives certain privileges and franchises, and holds them subject to the laws of the state and the limitations of its charter. Its powers are limited by law. It can make no contract not authorized by its charter. Its rights to act as a corporation are only preserved to it so long as it obeys the laws of its creation. There is a reserved right in the legislature to investigate its contracts and find out whether it has exceeded its powers. It would be a strange anomaly to hold that a state, having chartered a corporation to make use of certain franchises, could not, in exercise of its sovereignty, inquire how these franchises had been employed, and whether they had been abused, and demand the production of the corporate books and papers for that purpose. The defense amounts to this: That an officer of a corporation which is charged with a criminal violation of the statute, may plead the criminality of such corporation as a refusal to produce its books. To state this proposition is to answer it. While an individual may lawfully refuse to answer incriminating questions unless protected by an immunity statute, it does not follow that a corporation, vested with special privileges and franchises, may refuse to show its hand when charged with an abuse of such privileges."
In other words as a public charity the institution is in partnership with the state. As such it forfeits all rights to act as God's sanctuary. So, how many times must it be stated that a "church" which selects incorporated status under state or federal venue is, in law and in fact, a bona fide creation of government? This means that it is legally a state institution, placed in possession of special, state statutory privileges and obligations. The government is the definite "sovereign" to the corporations, and all artificial entities, and persons which it creates. Where in the Bible does it describe the Body of Christ, along with its tithes and offerings (which are supposedly "freely given" without duplicity) as an "artificial person?"
A Dictator's Definition: a quote from former Italian dictator Benito Mussolini on his strategy to manage the people and government of Italy via corporations. "Fascism should more properly be called corporatism because it is the merger of state and corporate power" (The "Encyclopedia Italiana," Giovanni Gentile, editor; late 1930's)
SHOULD CHURCHES BE INCORPORATED?
By Dr. Jim Ellis, THD, PHD
THE ISSUE OF THE SOVEREIGNTY OF GOD
The Pledge of Allegiance to the American Flag says--”One Nation Under God.” That is a statement of the Sovereignty of God! The United States, according to that, is under the Sovereignty of God! To follow this through, the highest governmental sovereignty is the Federal Government. The State Government is a lesser sovereign under the Federal Government, and the Local Government is a lesser sovereign under the State. The Local Government does not tax the State Government; neither does the State tax the Federal Government. On the other hand, the Federal government does not apply to the State for tax exemption, and the State does not apply to the Local Government for tax exemption.
The Church is under the Sovereignty of God in Jesus Christ, or is it? Does the Church recognize another sovereign over it? In Matthew 16:18, Jesus tells us “...upon this rock I will build my church and the gates of hell shall not prevail against it.” The Church is supposed to be under Jesus Christ, but there are many occasions in which the Church recognizes other sovereigns over it.
In Daniel 2:21, Daniel recognizes that God sets up kings and removes kings. That is a statement of the Sovereignty of God over nations and kings.
The next question is concerning our nation. Did our system of laws come from belief in the Sovereignty of God and the authority of the Word of God? The answer is “yes.”
Our system of laws comes from the Word of God by way of English Common Law. In the 17th Century a Scottish Presbyterian Preacher, Samuel Rutherford, wrote a controversial book entitled “Lex Rex.” The Latin word “Lex” means “law” and the Latin word “Rex” means “king.” In other words it means “The Law is the King,” rather than “The King is the Law.” Samuel Rutherford was sentenced to death for this attack on the philosophy of the British Monarchy, but died a natural death before the sentence could be carried out. Rutherford’s premise for this book was based on the belief that the Word of God is the basis for all law. This book is on the shelves of many attorneys.
Following the work of Samuel Rutherford came the volumes by William Blackstone, “Commentaries on the Laws of England” (British Common Law), which became the foundation for our system of American Law set down by the Founding Fathers. “The Federalist Papers” often refer to Blackstone’s monumental works that are on the library shelves of most reputable attorneys.
This was the basis on which our Constitution was conceived. This, and other founding documents, especially the Bill of Rights, guaranteed these freedoms that were set forth in the Word of God. Note that the Constitution and the Bill of Rights did not give us these freedoms, but, rather, guaranteed these freedoms given to us by God in His Word.
In about 1908, Justice Holmes, who was about to take his seat on the U.S. Supreme Court stated that, “The Constutution is what the Supreme Court says it is.” From that we saw the diminishing of the Constitution and Common Law in favor of case law. In other words, court cases began to be decided on the basis of case law instead of Common Law. That has led to philosophies such as “public policy” and “political correctness” that are always changing. The Constitution was designed to protect the unpopular and the minorities, but “public policy” and “political correctness” are based on the will of the majority or the powerful.
Since Bible-believing churches are opposed to many of the things defended by those philosophies, these churches have become the targets of our amoral society. That is why we must defend our position that churches are under the Sovereignty of God; and, since God is the highest Sovereign of all, we must remember that there is no higher sovereign--neither the Federal Government, nor the State, nor the Local Government.
As individuals, we are bound to obey the civil authorities until there is a conflict with the Word of God, but we must defend the Church that Jesus Christ founded from encroachment and entanglement from governments.
ARE CHURCHES TAX EXEMPT OR NON-TAXABLE?
This is an issue that is big and important--are churches tax-exempt or non-taxable? To be tax-exempt means that someone has the authority to tax a church or to grant an exemption from taxation. This is a sovereignty issue! Does a lower sovereign tax a higher sovereign? Of course not! Is the Church under the Sovereignty of God? Yes, it is supposed to be. To state it a different way--is Jesus Christ the head of the Church? That is what the Bible teaches. What are the three levels of governmental sovereignty--Federal, State, Local. Should any of the three tax the Church? Does a lower sovereign tax a higher sovereign? Is the Church under the sovereignty of the Federal, State, and Local Governments? The answers to these things are obvious to those who believe the Bible. We as individuals are subject to the laws of the land, but when it comes to the operation of the Church, that is a different thing.
The courts have recognized that religious institutions can be destroyed by the financial burden placed upon them through taxation. One of the landmark cases on this subject is the 1970 case of Walz versus the Tax Commission of New York in which the Court said to the effect that churches have enjoyed freedom from taxation for over two hundred years and it is not going to change any time soon. The Court also stated that churches provide services that the government would have to provide otherwise; and, therefore, tax-exemption does not violate the First Amendment Religious Freedom Establishment Clause.
“Non-taxable” means that the entity, such as the Church, is not taxable at all. It does not apply to anyone for tax-exemption, nor does it recognize the authority of some agency to tax it. To apply gives that authority by forfeit or waiver. “Non-taxable” is the position that we must strive for.
In Lee County, Florida, we had a Property Appraiser in Mr. Ken Wilkinson who understands the issue and has changed the annual report to the Property Appraiser for churches from “tax-exempt” to “non-taxable.” As far as I know, this is the only County in the State of Florida that has done this. We must educate others to this issue and we will stop the present trend of taxing churches, as is being done in Sarasota County.
Although it is unlawful to directly tax churches and synagogues, they are being taxed under the guise of “assessments,” “fees,” “impact fees,” etc. In order for an assessment to be a legal assessment it must give the equal benefit as to the amount of the assessment. In other words, if the assessment is $1,000 there must be $1000 in benefits; otherwise it is a tax and you can’t tax churches. Cities and Counties are getting by with it because they are depending on no one challenging it. Many cities and counties are charging excessive fees for permits and road impact fees to churches without being questioned, relying on the fact that very few churches will protest it. Several years ago, I received a letter from an official with the Federal Department of Transportation in Tallahassee to the effect that churches have no impact on roads because they operate at low peak hours. A possible exception to that would be if the church operates a large Christian Day School.
The courts have ruled that churches must be given special consideration and are not to be treated “like everyone else.” Churches have a special status. The City of Cape Coral continued to look upon churches as “commercial” ventures, even though they are non-profit. In their fees, requirements, etc., they violated the recently passed Florida Religious Freedom Restoration of Act of 1998. In their requirements for us to go through the PDP (Project Development Plan), because we have over three acres of land, they demanded $2000 up front to just begin the process, although we went through this when we were in Lee County in 1986. This required us to spend $10,000--$15,000 for an engineer to do a site plan as though we were a commercial project, just starting to develop. The City eventually passed a special ordinance, exempting churches in certain zoning categories from having to comply. We learned that we were the only church in the City in that category. In other words---the City passed the ordinance to get us off their back.
This follows the track record of the City of Cape Coral. In 1996-1997 the City of Cape Coral assessed churches on the basis of being “commercial” developments in their utilities construction program. It resulted in such ridiculous assesssments of $240,000 for the Trinity Reformed Church and over $100,000 for the Jewish Synagogue where my friend, Albert Cohen, is the Rabbi. Assistant Utilities Director Steve Kiss reported in a newspaper interview that “We treat churches just like K-Mart.” Churches and Synagogues are not “Commercial.”
Although my church was not even assessed, I jumped in and got together with four others to file suit against the City on the issue. Attorneys for the City recommended that they settle with us because the City had not even followed the advice of their own experts in their methodology of assessment. On the date that the resolution came before the City Council to settle the suit, most of the City Council, including the Mayor, were not going to vote for it until a number of church representatives testified that they had received foreclosure notices from the City on their church properties.
It is my belief that cities and counties would like to get rid of some of the churches in order to bring their properties under the tax roles. Other authorities agree, and this is the trend all over the Country.
PROBLEMS WITH CHURCH INCORPORATION
The popular notion today is that churches ought to be incorporated in order to be protected from lawsuits. Lawyers are advising churches to do so. We must remember that lawyers are officers of the court.
The truth is that when a church is incorporated it becomes an entity of the State in which it is incorporated. James Madison was opposed to church incorporation and the State of Virginia does not allow churches to be incorporated even today. (This has recently been changed [DMH]).
In 1989 the American Bar Association held its annual meeting in San Francisco. All the workshops were on the subject of “How To Pierce The Corporate Veil”-- in other words-”How To Sue Incorporated Churches.”
The truth is that being incorporated does not give protection, but it takes churches out from under the Sovereignty of God and places them under the State. The highest ranking officer of an incorporated church is the Resident Agent, who is responsible to the State. It has Unscriptural officers--a Board of Trustees. These are responsible to the State for the operation of the church.
Something else changes when a church is incorporated. As long as a church is not incorporated, it is a “Private Religious Body”; but when it becomes incorporated, it becomes “Public Accommodation.” Think about it--to whom do you apply for incorporation--the State protects you as a public entity. This is an issue that is not often raised, but it will be.
In the 1991 Americans With Disabilities Act (ADA), the Federal Government made an exemption for churches because churches are not “Public Accommodation.” The State of Florida chose to ignore that and placed churches under the Florida Handicap Code until some of us complained which resulted in the Federal Government cutting off Federal Funds to the State until it complied. Although the ADA did not make the distinction of incorporated churches and unincorporated churches, it will be a factor in the future.
In the Florida case of Matthews versus Adams, the Court said to the effect that when a church body voluntarily incorporates itself under the Laws of the State of Florida it becomes subject to all Laws of Incorporation, such as records disclosure. That would also include discrimination, if enforced.
The question I have is this: "Is the church secular or sacred?" Should a church follow Biblical principles or secular philosophies? Should a church go to Egypt for protection or should it trust God?
If it is so dangerous for a church to be unincorporated, then why were churches not allowed to be incorporated in the State of Virginia until recently.
EXAMPLES OF THE PROBLEMS OF INCORPORATION
When Pastor Everett Sileven went to court in Nebraska some years ago, the judge refused to hear First Amendment pleas because Brother Siliven's church, the Faith Baptist Church of Louisville, Nebraska, was incorporated.
In the case of Evangelist Lester Roloff, Judge Jack Pope said, "The issue is not whether People's Baptist is performing a service that falls beneath licensing standards. The three homes have a good record of high quality service. People's Baptist, from this record, could no doubt easily satisfy licensing requirements, but has chosen not to do so. It reasons that licensing interferes with religious freedom. People's Baptist does not, however, resist all licensing to do business in Texas. In fact, it does its business and service as a corporation under the name of Corpus Christi People's Baptist Church, Inc., and it complies with all business licensing requirements." In other words, the judge said that incorporation is a form of licensing, and churches that are incorporated are licensed in the state where they are incorporated. He is also telling us that when a church is incorporated, it is a business.
Isaiah 31:1 warns about going down to Egypt for help. "Woe to them that go down to Egypt for help; and stay on horses, and trust in chariots, because they are many; and horsemen, because they are very strong; but they look not unto the Holy One of Israel, neither seek the Lord."
Vs. 3, "Now the Egyptians are men, and not God; and their horses flesh, and not spirit. When the Lord shall stretch out his hand, both he that helpeth shall fall, and he that is holpen shall fall down, and they all shall fail together."
A few years ago, a church bus convention was held at Indianapolis Baptist Temple. A pastor attending the meeting was killed in a plane crash while piloting a rented plane on the way to look at a bus. The widow filed suit against the church. When Dr. Dixon asked the lady why she sued the church, her reply was, "I'm not suing the church; I'm suing the corporation."
In the 1988 case of Matthews vs. Adams, the Florida Fifth District Court of Appeals said, "When the members of the church decided to incorporate their body under the laws of the State of Florida, they submitted themselves to the jurisdiction of the state courts in all matters of a corporate nature, such as accounting for funds." The Florida corporate laws also prohibit discrimination and call for the examination of corporate records by the State.
A few years ago, pastors in Bessemer, Alabama, were sent bills for a pulpit tax (Franchise Tax?) by local government officials. That tells us that an incorporated church is a state licensed church and is subject to franchise tax. If you don't think it will happen, you have had your head buried in the sand too long.
Even President James Madison was opposed to churches being incorporated. On February 21, 1809, he vetoed an act incorporating the Protestant Episcopal Church in the town of Alexandria, in the District of Columbia. His reason was that incorporation was a form of licensing by which the government gave churches permission to operate. (CHRISTIANITY AND THE CONSTITUTION-THE FAITH OF OUR FOUNDING FATHERS, by John Eidsmore, pgs. 110, 111, Baker Book House, Grand Rapids, Michigan).
PRACTICAL ISSUES
I. Tax Exempt Status with the IRS:
As my church began studying procedures for dis-incorporation, one of the concerns was tax exempt status with the Internal Revenue Service. I have a problem with a church, which is under the Sovereignty of God, asking a lesser sovereign for tax exempt status. An attorney in Brentwood, Tennessee, who specializes in tax law, informed me that a church is exempt from applying for tax exempt status, according to Section 508(c)(1)(A) of the IRS Code.
I had often heard the reference to 501(c) as pertaining to the classification of churches with the IRS. When I began to study I discovered, to my surprize, that churches are not even mentioned under 501(c), but "corporations for religious purposes." Then I read 508(c)(1)(A) which reads "Mandatory exceptions. - sections (a and (b) shall not apply to-(A) churches, their integrated auxiliaries, and conventions or associations of churches." I made a call to the "800" number of the IRS in Atlanta, and was referred to their "technical (legal) department." I told the gentleman on the line the following: "My church, New Testament Baptist Church, used to be incorporated, but because of Biblical convictions, we did away with the corporation. We are not a "tax dodge," but a duly constituted church with regular services. According to 508(c)(1)(A), a church that operates as a legitimate church does not have to apply for tax exempt status--is that correct?" The official said, "That is correct, but I will get back with you in a few days to be sure." About a week later he called my office and talked to my wife to confirm it. It is interesting that the IRS Code lists "Corporations for religious purposes" under 501 (c), and "churches" under 508(c)(1)(A). Could it be possible that the IRS knows something that we preachers don't know?
An occurrence at the Landmark Baptist Church in Haines City, Florida is an example of the danger of churches being regarded as "Public." A truck driver had left his rig on the parking lot of the church, blocking quite a number of parking places during church services. The Police Department was called, but responded with "That's private property; we don't have the authority to come on private property." The Church also has handicap parking signs on this same property. As you can readily see, the handicap parking spaces are only needed when church services are going on, but the Haines City Police Department came on this same "Private Property" and issued $100 parking tickets for vehicles in handicap spaces that did not have handicap stickers on them.
An old U.S. Supreme Court case, the 1905 Hale Vs. Henkel, 201 U.S., contradicts what some attorneys are saying concerning incorporated churches being "private."
"Upon the other hand, the corporation is a creature of the State. It is presumed to be incorporated for the benefit of the public. It receives certain privileges and franchises, and holds them subject to the laws of the State and the limitations of its charter. Its powers are limited by law. It can make no contract not authorized by its charter. Its rights to act as a corporation are only preserved to it so long as it obeys the laws of its creation." (paqes 74, 75).
PLEASE NOTE THAT THIS CASE PLAINLY LABELS A "CORPORATION' AS A "FRANCHISE." If you have an incorporated church, you have a church that is granted a "franchise" by the State. (In the Roloff Case the judge said that incorporation is the same as a "license.")
As I heard in a CLA legal seminar for pastors, we can waive our rights by what we say. There have been some changes in court rulings involving the First Amendment Religious Freedom Clause. Some cases are being lost when that is used, but the change has been to use freedom of assembly and freedom of speech and accomplish the same thing, since these are directly involved in religious freedom. When a person in leadership in a church says, “This is not a freedom of assembly or freedom of speech issue--this is a religious freedom issue, that church may forfeit the right to use that plea.” We must caution church leaders and members to be very careful in what they say. We can no longer hide our heads in the sand. Remember, “ignorance of the law is no excuse.”
.
By Dr. Jim Ellis, THD, PHD
THE ISSUE OF THE SOVEREIGNTY OF GOD
The Pledge of Allegiance to the American Flag says--”One Nation Under God.” That is a statement of the Sovereignty of God! The United States, according to that, is under the Sovereignty of God! To follow this through, the highest governmental sovereignty is the Federal Government. The State Government is a lesser sovereign under the Federal Government, and the Local Government is a lesser sovereign under the State. The Local Government does not tax the State Government; neither does the State tax the Federal Government. On the other hand, the Federal government does not apply to the State for tax exemption, and the State does not apply to the Local Government for tax exemption.
The Church is under the Sovereignty of God in Jesus Christ, or is it? Does the Church recognize another sovereign over it? In Matthew 16:18, Jesus tells us “...upon this rock I will build my church and the gates of hell shall not prevail against it.” The Church is supposed to be under Jesus Christ, but there are many occasions in which the Church recognizes other sovereigns over it.
In Daniel 2:21, Daniel recognizes that God sets up kings and removes kings. That is a statement of the Sovereignty of God over nations and kings.
The next question is concerning our nation. Did our system of laws come from belief in the Sovereignty of God and the authority of the Word of God? The answer is “yes.”
Our system of laws comes from the Word of God by way of English Common Law. In the 17th Century a Scottish Presbyterian Preacher, Samuel Rutherford, wrote a controversial book entitled “Lex Rex.” The Latin word “Lex” means “law” and the Latin word “Rex” means “king.” In other words it means “The Law is the King,” rather than “The King is the Law.” Samuel Rutherford was sentenced to death for this attack on the philosophy of the British Monarchy, but died a natural death before the sentence could be carried out. Rutherford’s premise for this book was based on the belief that the Word of God is the basis for all law. This book is on the shelves of many attorneys.
Following the work of Samuel Rutherford came the volumes by William Blackstone, “Commentaries on the Laws of England” (British Common Law), which became the foundation for our system of American Law set down by the Founding Fathers. “The Federalist Papers” often refer to Blackstone’s monumental works that are on the library shelves of most reputable attorneys.
This was the basis on which our Constitution was conceived. This, and other founding documents, especially the Bill of Rights, guaranteed these freedoms that were set forth in the Word of God. Note that the Constitution and the Bill of Rights did not give us these freedoms, but, rather, guaranteed these freedoms given to us by God in His Word.
In about 1908, Justice Holmes, who was about to take his seat on the U.S. Supreme Court stated that, “The Constutution is what the Supreme Court says it is.” From that we saw the diminishing of the Constitution and Common Law in favor of case law. In other words, court cases began to be decided on the basis of case law instead of Common Law. That has led to philosophies such as “public policy” and “political correctness” that are always changing. The Constitution was designed to protect the unpopular and the minorities, but “public policy” and “political correctness” are based on the will of the majority or the powerful.
Since Bible-believing churches are opposed to many of the things defended by those philosophies, these churches have become the targets of our amoral society. That is why we must defend our position that churches are under the Sovereignty of God; and, since God is the highest Sovereign of all, we must remember that there is no higher sovereign--neither the Federal Government, nor the State, nor the Local Government.
As individuals, we are bound to obey the civil authorities until there is a conflict with the Word of God, but we must defend the Church that Jesus Christ founded from encroachment and entanglement from governments.
ARE CHURCHES TAX EXEMPT OR NON-TAXABLE?
This is an issue that is big and important--are churches tax-exempt or non-taxable? To be tax-exempt means that someone has the authority to tax a church or to grant an exemption from taxation. This is a sovereignty issue! Does a lower sovereign tax a higher sovereign? Of course not! Is the Church under the Sovereignty of God? Yes, it is supposed to be. To state it a different way--is Jesus Christ the head of the Church? That is what the Bible teaches. What are the three levels of governmental sovereignty--Federal, State, Local. Should any of the three tax the Church? Does a lower sovereign tax a higher sovereign? Is the Church under the sovereignty of the Federal, State, and Local Governments? The answers to these things are obvious to those who believe the Bible. We as individuals are subject to the laws of the land, but when it comes to the operation of the Church, that is a different thing.
The courts have recognized that religious institutions can be destroyed by the financial burden placed upon them through taxation. One of the landmark cases on this subject is the 1970 case of Walz versus the Tax Commission of New York in which the Court said to the effect that churches have enjoyed freedom from taxation for over two hundred years and it is not going to change any time soon. The Court also stated that churches provide services that the government would have to provide otherwise; and, therefore, tax-exemption does not violate the First Amendment Religious Freedom Establishment Clause.
“Non-taxable” means that the entity, such as the Church, is not taxable at all. It does not apply to anyone for tax-exemption, nor does it recognize the authority of some agency to tax it. To apply gives that authority by forfeit or waiver. “Non-taxable” is the position that we must strive for.
In Lee County, Florida, we had a Property Appraiser in Mr. Ken Wilkinson who understands the issue and has changed the annual report to the Property Appraiser for churches from “tax-exempt” to “non-taxable.” As far as I know, this is the only County in the State of Florida that has done this. We must educate others to this issue and we will stop the present trend of taxing churches, as is being done in Sarasota County.
Although it is unlawful to directly tax churches and synagogues, they are being taxed under the guise of “assessments,” “fees,” “impact fees,” etc. In order for an assessment to be a legal assessment it must give the equal benefit as to the amount of the assessment. In other words, if the assessment is $1,000 there must be $1000 in benefits; otherwise it is a tax and you can’t tax churches. Cities and Counties are getting by with it because they are depending on no one challenging it. Many cities and counties are charging excessive fees for permits and road impact fees to churches without being questioned, relying on the fact that very few churches will protest it. Several years ago, I received a letter from an official with the Federal Department of Transportation in Tallahassee to the effect that churches have no impact on roads because they operate at low peak hours. A possible exception to that would be if the church operates a large Christian Day School.
The courts have ruled that churches must be given special consideration and are not to be treated “like everyone else.” Churches have a special status. The City of Cape Coral continued to look upon churches as “commercial” ventures, even though they are non-profit. In their fees, requirements, etc., they violated the recently passed Florida Religious Freedom Restoration of Act of 1998. In their requirements for us to go through the PDP (Project Development Plan), because we have over three acres of land, they demanded $2000 up front to just begin the process, although we went through this when we were in Lee County in 1986. This required us to spend $10,000--$15,000 for an engineer to do a site plan as though we were a commercial project, just starting to develop. The City eventually passed a special ordinance, exempting churches in certain zoning categories from having to comply. We learned that we were the only church in the City in that category. In other words---the City passed the ordinance to get us off their back.
This follows the track record of the City of Cape Coral. In 1996-1997 the City of Cape Coral assessed churches on the basis of being “commercial” developments in their utilities construction program. It resulted in such ridiculous assesssments of $240,000 for the Trinity Reformed Church and over $100,000 for the Jewish Synagogue where my friend, Albert Cohen, is the Rabbi. Assistant Utilities Director Steve Kiss reported in a newspaper interview that “We treat churches just like K-Mart.” Churches and Synagogues are not “Commercial.”
Although my church was not even assessed, I jumped in and got together with four others to file suit against the City on the issue. Attorneys for the City recommended that they settle with us because the City had not even followed the advice of their own experts in their methodology of assessment. On the date that the resolution came before the City Council to settle the suit, most of the City Council, including the Mayor, were not going to vote for it until a number of church representatives testified that they had received foreclosure notices from the City on their church properties.
It is my belief that cities and counties would like to get rid of some of the churches in order to bring their properties under the tax roles. Other authorities agree, and this is the trend all over the Country.
PROBLEMS WITH CHURCH INCORPORATION
The popular notion today is that churches ought to be incorporated in order to be protected from lawsuits. Lawyers are advising churches to do so. We must remember that lawyers are officers of the court.
The truth is that when a church is incorporated it becomes an entity of the State in which it is incorporated. James Madison was opposed to church incorporation and the State of Virginia does not allow churches to be incorporated even today. (This has recently been changed [DMH]).
In 1989 the American Bar Association held its annual meeting in San Francisco. All the workshops were on the subject of “How To Pierce The Corporate Veil”-- in other words-”How To Sue Incorporated Churches.”
The truth is that being incorporated does not give protection, but it takes churches out from under the Sovereignty of God and places them under the State. The highest ranking officer of an incorporated church is the Resident Agent, who is responsible to the State. It has Unscriptural officers--a Board of Trustees. These are responsible to the State for the operation of the church.
Something else changes when a church is incorporated. As long as a church is not incorporated, it is a “Private Religious Body”; but when it becomes incorporated, it becomes “Public Accommodation.” Think about it--to whom do you apply for incorporation--the State protects you as a public entity. This is an issue that is not often raised, but it will be.
In the 1991 Americans With Disabilities Act (ADA), the Federal Government made an exemption for churches because churches are not “Public Accommodation.” The State of Florida chose to ignore that and placed churches under the Florida Handicap Code until some of us complained which resulted in the Federal Government cutting off Federal Funds to the State until it complied. Although the ADA did not make the distinction of incorporated churches and unincorporated churches, it will be a factor in the future.
In the Florida case of Matthews versus Adams, the Court said to the effect that when a church body voluntarily incorporates itself under the Laws of the State of Florida it becomes subject to all Laws of Incorporation, such as records disclosure. That would also include discrimination, if enforced.
The question I have is this: "Is the church secular or sacred?" Should a church follow Biblical principles or secular philosophies? Should a church go to Egypt for protection or should it trust God?
If it is so dangerous for a church to be unincorporated, then why were churches not allowed to be incorporated in the State of Virginia until recently.
EXAMPLES OF THE PROBLEMS OF INCORPORATION
When Pastor Everett Sileven went to court in Nebraska some years ago, the judge refused to hear First Amendment pleas because Brother Siliven's church, the Faith Baptist Church of Louisville, Nebraska, was incorporated.
In the case of Evangelist Lester Roloff, Judge Jack Pope said, "The issue is not whether People's Baptist is performing a service that falls beneath licensing standards. The three homes have a good record of high quality service. People's Baptist, from this record, could no doubt easily satisfy licensing requirements, but has chosen not to do so. It reasons that licensing interferes with religious freedom. People's Baptist does not, however, resist all licensing to do business in Texas. In fact, it does its business and service as a corporation under the name of Corpus Christi People's Baptist Church, Inc., and it complies with all business licensing requirements." In other words, the judge said that incorporation is a form of licensing, and churches that are incorporated are licensed in the state where they are incorporated. He is also telling us that when a church is incorporated, it is a business.
Isaiah 31:1 warns about going down to Egypt for help. "Woe to them that go down to Egypt for help; and stay on horses, and trust in chariots, because they are many; and horsemen, because they are very strong; but they look not unto the Holy One of Israel, neither seek the Lord."
Vs. 3, "Now the Egyptians are men, and not God; and their horses flesh, and not spirit. When the Lord shall stretch out his hand, both he that helpeth shall fall, and he that is holpen shall fall down, and they all shall fail together."
A few years ago, a church bus convention was held at Indianapolis Baptist Temple. A pastor attending the meeting was killed in a plane crash while piloting a rented plane on the way to look at a bus. The widow filed suit against the church. When Dr. Dixon asked the lady why she sued the church, her reply was, "I'm not suing the church; I'm suing the corporation."
In the 1988 case of Matthews vs. Adams, the Florida Fifth District Court of Appeals said, "When the members of the church decided to incorporate their body under the laws of the State of Florida, they submitted themselves to the jurisdiction of the state courts in all matters of a corporate nature, such as accounting for funds." The Florida corporate laws also prohibit discrimination and call for the examination of corporate records by the State.
A few years ago, pastors in Bessemer, Alabama, were sent bills for a pulpit tax (Franchise Tax?) by local government officials. That tells us that an incorporated church is a state licensed church and is subject to franchise tax. If you don't think it will happen, you have had your head buried in the sand too long.
Even President James Madison was opposed to churches being incorporated. On February 21, 1809, he vetoed an act incorporating the Protestant Episcopal Church in the town of Alexandria, in the District of Columbia. His reason was that incorporation was a form of licensing by which the government gave churches permission to operate. (CHRISTIANITY AND THE CONSTITUTION-THE FAITH OF OUR FOUNDING FATHERS, by John Eidsmore, pgs. 110, 111, Baker Book House, Grand Rapids, Michigan).
PRACTICAL ISSUES
I. Tax Exempt Status with the IRS:
As my church began studying procedures for dis-incorporation, one of the concerns was tax exempt status with the Internal Revenue Service. I have a problem with a church, which is under the Sovereignty of God, asking a lesser sovereign for tax exempt status. An attorney in Brentwood, Tennessee, who specializes in tax law, informed me that a church is exempt from applying for tax exempt status, according to Section 508(c)(1)(A) of the IRS Code.
I had often heard the reference to 501(c) as pertaining to the classification of churches with the IRS. When I began to study I discovered, to my surprize, that churches are not even mentioned under 501(c), but "corporations for religious purposes." Then I read 508(c)(1)(A) which reads "Mandatory exceptions. - sections (a and (b) shall not apply to-(A) churches, their integrated auxiliaries, and conventions or associations of churches." I made a call to the "800" number of the IRS in Atlanta, and was referred to their "technical (legal) department." I told the gentleman on the line the following: "My church, New Testament Baptist Church, used to be incorporated, but because of Biblical convictions, we did away with the corporation. We are not a "tax dodge," but a duly constituted church with regular services. According to 508(c)(1)(A), a church that operates as a legitimate church does not have to apply for tax exempt status--is that correct?" The official said, "That is correct, but I will get back with you in a few days to be sure." About a week later he called my office and talked to my wife to confirm it. It is interesting that the IRS Code lists "Corporations for religious purposes" under 501 (c), and "churches" under 508(c)(1)(A). Could it be possible that the IRS knows something that we preachers don't know?
An occurrence at the Landmark Baptist Church in Haines City, Florida is an example of the danger of churches being regarded as "Public." A truck driver had left his rig on the parking lot of the church, blocking quite a number of parking places during church services. The Police Department was called, but responded with "That's private property; we don't have the authority to come on private property." The Church also has handicap parking signs on this same property. As you can readily see, the handicap parking spaces are only needed when church services are going on, but the Haines City Police Department came on this same "Private Property" and issued $100 parking tickets for vehicles in handicap spaces that did not have handicap stickers on them.
An old U.S. Supreme Court case, the 1905 Hale Vs. Henkel, 201 U.S., contradicts what some attorneys are saying concerning incorporated churches being "private."
"Upon the other hand, the corporation is a creature of the State. It is presumed to be incorporated for the benefit of the public. It receives certain privileges and franchises, and holds them subject to the laws of the State and the limitations of its charter. Its powers are limited by law. It can make no contract not authorized by its charter. Its rights to act as a corporation are only preserved to it so long as it obeys the laws of its creation." (paqes 74, 75).
PLEASE NOTE THAT THIS CASE PLAINLY LABELS A "CORPORATION' AS A "FRANCHISE." If you have an incorporated church, you have a church that is granted a "franchise" by the State. (In the Roloff Case the judge said that incorporation is the same as a "license.")
As I heard in a CLA legal seminar for pastors, we can waive our rights by what we say. There have been some changes in court rulings involving the First Amendment Religious Freedom Clause. Some cases are being lost when that is used, but the change has been to use freedom of assembly and freedom of speech and accomplish the same thing, since these are directly involved in religious freedom. When a person in leadership in a church says, “This is not a freedom of assembly or freedom of speech issue--this is a religious freedom issue, that church may forfeit the right to use that plea.” We must caution church leaders and members to be very careful in what they say. We can no longer hide our heads in the sand. Remember, “ignorance of the law is no excuse.”
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