Understanding
Why we are unincorporated, and a lesson from the Universal Life Church
Our founding minister was ordained by the ULC. Its history is the clearest map ever drawn of how a small church loses everything, and we built ours to avoid every mark on it.
Unincorporated, on purpose
A church may be a corporation, and most are, because incorporation gives a liability shield and makes banks and county clerks comfortable. We chose not to. An unincorporated religious association exists the moment its members associate; it owes the state no filing, no fee, no annual report, and no registered agent. It is the oldest form a church can take.
The trade-off is real and we accept it with open eyes. There is no corporate shield, so our Constitution forbids debt, our Covenant includes a release, and our Trustees hold property under a strict declaration. If the day comes when the shield is worth more than the independence, the members can vote to incorporate. Nothing in our documents prevents it.
The Universal Life Church
Our founding minister holds ordination from the Universal Life Church, which has ordained anyone who asks, free, since 1962. We are glad of it. The ULC's insistence that no institution stands between a person and the Divine is our own.
But the ULC's history is also a warning, and we would be dishonest not to tell it. In the 1970s and 80s the Modesto church sold "charters" allowing anyone to declare a congregation. Thousands used them as tax shelters: they took vows of poverty, signed their wages over to "the church," and had the church pay their mortgage, groceries, and car. The Tax Court took these apart case after case (Unitary Mission Church v. Commissioner is the lead one), and in 1984 the IRS revoked the ULC's own exemption, a revocation the Court of Claims upheld. The pattern the courts condemned was always the same:
- a church whose income came almost entirely from its minister and went almost entirely back to him;
- a "housing allowance" that was really the minister's whole living expense;
- a board of one, or of a husband and wife;
- no congregation, no services, no records: a church on paper.
How Spiritual Results is built against every one of those
- The Council of Elders must always have a majority who are unrelated to the minister and unpaid. They fix his compensation with him out of the room, on comparable data, in writing.
- No personal expense may ever be paid from church funds. The minister is paid a reasonable salary and pays his own bills. Reimbursement is only under an accountable plan with receipts.
- The housing allowance is designated in advance, in minutes, within the limits the law sets, and only for a minister who actually conducts worship and administers the church.
- We gather, on a schedule, and the Clerk records it.
- Our property is dedicated irrevocably to religious purposes and goes to another church if we dissolve.
- The Church accepts no gift earmarked for a named person and does not act as anyone's pass-through.
None of this is hard. It is simply the discipline of keeping the church's money the church's, and the minister's the minister's. The ULC lesson is that the moment those two blur, there is no church left to protect.