The "Caterson Drawer"
Below is a list of important church documents every church must ensure to have copies on file, stored in a secure, fireproof drawer or cabinet accessible for future leaders, auditors, and the governing body.
Protect important documents and ensure access to organizational records for future generations by creating a Permanent File. The contents, described below, should be reviewed regularly, and updated with current information:
Church Property Deeds and Surveys
- Should always include United Methodist Church Trust Clause language.
- Check state laws regarding church name records. If the name is changed by the denomination, the change is valid (i.e., Methodist Episcopal Church is the same as The United Methodist Church). State laws may require creating a new deed with all previous deeds deeding to The United Methodist Church, New Jersey does not make this requirement.
- Surveys of property and buildings conducted to identify architecture, utilities, environmental or historic data, and title searches, noting any changes that have occurred.
- Check deeds for reversion clauses, which prevent property sale, because when the property is no longer used by the church, it reverts back to the grantors. A great many New Jersey churches have this problem.
- If you are missing these documents, contact your local municipality office or County Clerk’s Office as they should have copies on file. If your church name has changed over the years, you may need that information because the filing may be under the original church name.
- Policies describing who can be buried, what can be erected or put on site, temporarily or permanently, and maintenance expectations and rules.
- Columbarium construction and policies for disposition of cremains.
- Copies of bank statements for the perpetual care fund.
- Incorporation documents are required by GNJAC and New Jersey requires an entity to be incorporated to hold title to property. New Jersey has a separate incorporation statute for churches.
- You can search for your documents here.
- By-laws: Missions agencies will have articles of incorporation and by-laws. United Methodist churches use the current version of the Book of Discipline as their by-laws.
The General Council on Finance & Administration 501 (c) (3) Private Letter Ruling
- The General Council on Finance & Administration 501 (c) (3) Private Letter Ruling that identifies United Methodist churches as nonprofit entities since 1974. Some missions need to request a restatement for their inclusion in the umbrella status. New church starts need to request inclusion of their EIN to the Private Letter Ruling umbrella.
- Church Group Ruling – Tax Exemption page on the GFCA website.
Federal Employer Identification Number (EIN)
- Federal Employer Identification Number (EIN) required for all filings, including employee taxes and tax-exempt status.
Leases or Use Agreements
- Lease includes information about payments, access/keys, responsibilities, cancellation policy, insurance, and so on. The Lease will also include building-use rules and expectations.
- Rental agreement or building-use agreements for any group using the building for a couple of hours.
- Churches should never lease to an entity that is not a tax exempt 501 (C) (3), per US federal law. Any church engaging in any activity with any entity that is not a tax exempt 501 (c) (3) may risk their own property tax-exemption status and engage in taxable activity (Unrelated Business Income Tax).
- Parsonages location and information (Book of Discipline ¶2503). Parsonage rental agreements should be reviewed by legal counsel and may trigger tax implications if not used for a missional purpose. Parsonages sales have additional disciplinary requirements of approval by conference judicatories and district superintendents.
- Retain copies of the 501 (c) (3) documentation and insurance binder (verification of insurance coverage) from any groups/tenants using church owned buildings or property.
- Specific information related to the new Boy Scout Agreements (2022) can be found here.
- Property Insurance, including replacement, liability, and other appropriate coverage;
- Health Insurance, including verification of any coverage provided to staff or pastor;
- Vehicle insurance verification of coverage, if applicable.
Property Tax Exemption
- New Jersey requires a reapplication for property tax exemption every three years (“Further Statement”).
- Forms can be found here.
- The form for initial filing and the further statement can also be found here. (Coming soon)
- New York requires a reapplication for property tax exemption annually.
- Forms can be found here.
- Pennsylvania churches only have to file for their tax exempt property tax status once with their municipal Board of Assessment. Some municipalities may send confirmation letters occasionally which simply need to be answered.
- Titles for all vehicles and dates when registration, inspection, and insurance expire.
Tax & Tax Exemption Forms
- State Sales Tax Exemption Form.
- Copies of all letters sent to donors for their tax deductions for previous two years.
- Employee information and filings (W2’s, 1099’s , 941, 927, WR30, etc.).
Bank Accounts & Investments
- Bank accounts: numbers, statements and the names listed as “signers” with each financial institution.
- Be sure to update signers with changes in pastors and/or treasurers. Each bank has its own form.
- Investments: account numbers and summary of all assets, including Endowment Funds and Trusts and “signers” or authorized contact persons.
- Copies of all donor restricted bequests to the church through Wills and Trusts.
- Church policies, including but not limited to, Safe Sanctuary, Fire Drills, Financial Policy & Procedures, policy for distribution of Pastor’s Discretionary Fund, etc.
Current Charge/Church Conference Report Booklet
- Current Charge/Church Conference report booklet, with budget, audit, and nominations information.
- Audits must be completed annually per the Book of Discipline. Local Church Audit Guideline can be found here.