Breaking the Cycle of Defeat with 501(c)(3) Approval!

By Kaler Carpenter

We are pleased to inform you that upon review of your application for tax exempt status we have determined that you are exempt from Federal income tax under section 501(c)(3) of the Internal Revenue Code.

This if from a letter that The Redemption Movement received on Feb. 28, 2014 from the IRS confirming our status as a 501(3)(c) tax-exempt public charity! Concerning the needs of our church, this is a huge break, and in regards to us first submitting the application to the IRS in the Fall of 2012, this is a long time coming!

For our church, what makes this achievement extra momentous is the fact it's a major step in breaking what I call "The Church Planting Cycle of Defeat." Because we essentially started this church without the support of a national organization, church planting has been extra challenging. As we labored to get the church off the ground, I noticed a "Cycle of Defeat" that we were facing. It goes like this:

No Organizational Support = No 501(c)(3) Status
No 501(c)(3) Status = No Money

One advantage of being a part of a religious denomination or national organization is that a new church automatically has founding paperwork and tax-exempt status given to them from their supporting group. Because we lacked this support, we had to procure this paperwork on our own. We moved to Oneonta in July of 2009 to start The Redemption Movement, and in May of 2011 we had our church chartered with Otsego County, NY as a nonprofit organization.

Despite this accomplishment, we were still not tax-exempt in the eyes of the IRS. Therefore, one of the first actions of our newly installed board of officers was to pursue this status, which entailed a mountain of paperwork and a $450 fee.

What makes having 501(c)(3) status for a church so important is that people and other organizations are much more likely to donate to you if you have it. This is how we operated in the past concerning giving: We told donors that, as a church and a nonprofit organization, they can legally write off a donation to us on their income taxes. However, if a giver were to be audited, the burden to prove to the IRS that we are indeed a church would be on them, and we have information handy that we promise to provide donors if they were to be audited.

For many, the prospect of having to jump through an extra hoop with the IRS to prove that their donation is tax exempt is enough to deter giving. This is understandable, especially when a person is also being hit up for donations from various 501(c)(3) certified organizations that pose less risk of an audit.

Because we lacked 501(c)(3) status, we targeted our past fundraising efforts towards friends and family--people with whom we had personal relationships with and knew our hearts. In the Spring of 2013, we fundraised over $2,000 via social media to launch the church. This was a wonderful financial boost that allowed for the church to open our doors to the public, but virtually all of these donations were one-time gifts, which meant that our new church had no consistent funding to operate on (the majority of our current church attendees are new to church and tithing is a new concept). And let's face it; nobody wants to go through a second round of directly fundraising to family and friends, especially within the same year.

The solution to this fundraising problem is to have 501(c)(3) status. The IRS was taking their sweet time getting back to us about this, so we looked to the support of a church planting organizations and denominations for help. Only, the problem with this is:

No People = No Organizational Support
No Organizational Support = No 501(c)(3) Status

Laura and I resigned our ministry credentials with our previous denomination in order to church plant in Oneonta. It was a difficult choice for us, but we thought finding another group to partner with would be easy. We were wrong. Over the years, we have looked into at least 6 different groups to partner with, primarily so that we can have help us with obtaining founding paperwork, which includes getting 501(c)(3) status. So far, none of the groups have worked out. Some didn't work because we weren't compatible with their doctrines, which included disagreements on doctrines like women in ministry and spiritual gifts (we are for both of these hot topics).

But the most common disqualification that we ran into with established religious organizations is that they required 20-50 consistent people attending our church before they would even consider processing our application. This is a huge roadblock for us because we essentially "struck out on our own" with just the two of us, instead of being given a team of volunteers from a mother church (as is the most common way to church plant).

I totally understand where these groups are coming from, after all, there has to be policies like this in place to ensure that your organization is backing a church planter that's serious about the work and won't flake out after getting approval. However, for a small church like The Redemption Movement planting in a small town like Oneonta NY, 20-50 people = a successful and solid church in our eyes.

RM Launch 3-29-2013

Most church planting groups think bigger than us. They tend to target bigger and growing communities, and they mobilize dozens or even hundreds of people to see church launch events where hundreds, if not thousands, of new people show up. I have personal reservations about the sustainability and priorities of this model of church planting that I won't go into here. But I will say that our approach to church planting is different, as evidenced by how we launched The Redemption Movement. Instead of spending our launch money on advertising, we spent it on community outreach and we had 20 people attend our launch (a number that I am proud of).        

The need to spend money on advertising brings us to the next leg of our "Church Planting Cycle of Defeat."

No Money = No/Poor Marketing
No/Poor Marketing = No People

My heart is to give every dollar donated to the church to community outreach, but the reality of our situation dictates that we need to use some of our resources for marketing in order to tell people about the church. Our church marketing efforts so far have been pretty miniscule. We've used newspaper advertisements, Facebook, flyers, and a banner, but without a significant amount of money set aside for marketing, that's about all we can do. To properly market the church and gain the attention of more people, we need more money. Scroll up to the first part of the cycle to see how fundraising has gone for us, and now you can fully appreciate what it's like to church plant in this "Cycle of Defeat."

For years, I've referenced this cycle and been optimistic that if just one leg of it broke than the other parts will be sure to crumble. This is why our church finally gaining 501(c)(3) status is such a big deal for us!

What about The Redemption Movement Proudly Paying Taxes?     

This is a fair question because our church makes it a point to proudly pay property taxes as a way to show our local community love and support. In fact, twice a year when the property tax and school tax bill hit the mailboxes, we put out a sign in front of the church building that says "This Church and Property Pays Taxes. We Love Oneonta." We also regularly post a blog article about our stance on taxes to our church Facebook page.

At the heart of our reason for choosing to pay property taxes is to be a witness of Christ' love to our local community that's overburdened with high property taxes. This high tax burden has led to hostility toward local churches by people who don't think that this tax arrangement is fair. Rest assured; we're still committed to paying local property taxes as a way to bring  healing to this situation. It's our hope that an unbeliever who's skeptical or even angry at the church for not having to pay taxes will see our actions, be moved by them, and ultimately consider our message of the Gospel of Jesus Christ.

I think that our church gaining 501(c)(3) tax-exempt status through the Federal government for fundraising purposes is an entirely different situation than our church choosing to pay local property taxes for the purpose of being a good witness. For over three years now, our church has been trying to operate as a tax-paying organization. For reasons noted above in the defeat cycle, you can see how futile it is to operate a church in America without 501(c)(3) status.

Essentially, people and businesses are hesitant to donate to an organization without this tax-exempt status. In my personal observation, I find it interesting that the same people screaming, "Churches and charities should pay taxes," aren't donating their money to for-profit groups. Why? Because they can't write it off on their taxes. This is a different cycle of defeat that I think boils down to what's going on in a person's heart; because, when it comes to money, how someone spends or doesn't spend their money shows where their heart is at.

At The Redemption Movement, we're focused on ministering to the heart, and we're figuring out this money stuff along the way.

To Donate to The Redemption Movement   

If you want to contribute to the ministry of The Redemption Movement, checks are payable to "The Redemption Movement." You can mail them to:

148 River St.
Oneonta, NY, 13820

EIN: 45-3027565
DLN: 17053271349002

*Digital payment method coming soon.

Our $2,600.00 Outreach to Oneonta NY

By Kaler Carpenter
You can describe The Redemption Movement as a low-to-no budget church plant. Going against the advice of traditional church planting organizations, Laura and myself moved to Oneonta in 2009 with zero support, not knowing anybody in NY, and having just enough money saved up to put a down payment on a vacant storefront on River Street. Some may call it crazy, we call it faith, whatever you call it, this church has been a lot of hard work.

Our Taxing Situation

In the face of such hard work, like remodeling and working full time jobs instead of fundraising, we are sometimes tempted to take shortcuts. Having shortcuts placed before us causes conflict in our hearts. Jesus teaches that the easy way will often be in opposition to God's ways (that's why it's called the straight and narrow). One easy way we could have taken with the church is in regards to taxes.

Here's our taxing situation: back in 2009, we went before the Oneonta City Planning Committee to request that the River St. property purpose be changed for church use. By one vote and God's grace the measure passed, we then purchased the building and began working on our money pit. The agonizingly high New York property tax bills soon followed. Paying these tax bills took a lot of money away from the new church and made the work go much slower. Although, God has been very faithful in providing for our needs.

We are well aware that it's within the right of every church to seek exemption from property taxes. This thought crosses our minds with every check we write to pay our tax bill. We could have spent the last 4 years doing whatever it takes to get our property off the tax rolls; and in 4 years time, we surely could have figured it out. I mean, in the last 3 years we were able to write founding documents like articles of incorporation and church bylaws, and we put together a board of trustees and officers; therefore, achieving a tax exemption status for property tax is well within our capabilities, yet we chose not to. This is because of our values.

Taking People's Religious Objections Seriously

As a new church, one of our driving values is to strip away all the religious objections that people have against church, while remaining true to the Gospel. We believe that by taking this approach, it will make it easier for people to connect with God by discovering His love through His church. This is commanded in scripture; Acts 15:19, “We (the church) should not make it difficult (be dumb with our religion) for the Gentiles (non Jews, or modern application: irreligious people) who are turning to God (people who are genuinely seeking to know God).”

In this spirit, we have scrapped several objectionable religious practices, making it so that the only thing standing in the way of a seeker of truth turning their faith towards God is the cross of Jesus Christ (1 Corinthians 1:22-24). For us, ministering in a postmodern Northeast American culture, this means getting rid of Sunday morning church services, allowing women to teach, happily letting people who believe differently than we do use our space, removing the formal and judgmental tone from our teachings, and much more.

Showing God's Love By Paying Taxes

One objection that keeps many people from stepping foot inside a church is the issue of religion and taxes. Churches do not have to pay local taxes and many people believe this is unfair or even downright criminal. We believe that if churches skipping out on taxes is keeping a person from discovering the grace, hope, freedom, peace, joy, and love found in the body of Christ (the church), then we will gladly shell out a few thousand dollars per year ($2,625.25 to be exact) if that is what it takes to remove a religious objection and open one heart to the Gospel.

Making the commitment to pay taxes is a sacrifice for us (but hey, making sacrifices is what it means to be a Christian). We know we can take that money and do a lot of good with it by blessing the community of Oneonta in ways that the government, with all of its red tape, simply cannot. Generations ago, the entire nation felt the same way, which is why these tax exempt laws were put into place; but, times have changed and the majority of the public now believe the church is a bunch of crooks whose lack of paying taxes contributes to people's ever-growing tax burden.

Finical Abuse in Churches

I can think of several good examples of churches that are using their tax-free dollars to bless their communities with noble charity works. But you know what? I can also think of more examples of churches that are only using the money to ornately decorate their buildings while giving their wealthy Pastor another raise. As Christians, we apologize for this abuse of your hard earned tax dollars at the hands of religious people. Please accept our tax dollars as a first step towards making amends. Also, we want to do more than just pay bills, we want to show love to our community by investing time and money into making Oneonta a better place.

The City of Oneonta's Unique Tax-Exemption Dilemma

Normally, I do not like to shine the spotlight on church fiances; but I feel like in light of how strongly many people feel on this issue, shining a light on our actions can help to mend church-community relations. If you do not think this is an issue, then read the online public comments of the local newspaper every time a tax problem is discussed. Half of the comments say something to the tune of, “Tax the churches!” In fact, the not-for-profit institutions within the Oneonta city limits owns 51% of the real property value in the city. Due to this reality, many local residents hold nonprofits and churches responsible for their high tax bills. 

I would like to illustrate this point further by telling two brief stories. The first one is when I encountered a local business owner in May. It was while I was inviting Oneonta 6th Ward businesses to participate in our neighborhood block party by competing in a chili cook off (I was purposely not soliciting funds). One hardened 6th Ward Oneonta business owner replied to my introduction by scowling, “Church huh? Must be nice to find a way out of paying taxes!”

Another encounter I had was with a lady who was walking on the sidewalk in front of our building. She looked at our Redemption Movement sign and, not knowing that I was within earshot, said out loud to herself, "Oh great, this place doesn't have to pay taxes." As she continued walking, I called out to her about wanting to talk about our tax situation but she ignored me.

We Pay Taxes Because we Care for Our Community

Therefore, instead of morning the loss of $2,600, and pouting about how the money could have gone towards opening up our building earlier or reaching more people with God's love, I have decided to pay our taxes and make the amount public knowledge. We pray for our government and hope that these tax dollars will go to genuinely help people in need. The mission of The Redemption Movement is to bless our community, therefore we view our taxes as a $2,600 community outreach expense, and we will happily find ways to bless our town with what little we have. "Give to Caesar what is Caesar’s, and to God what is God’s”--Jesus.