Churches, Pastors, and Love Offerings

Pastors and ministers of religious institutions have come under increased scrutiny
relating to cash practices, and the proper accounting as well as reporting required for each.

There was a Pastor of a good Church in the mid-Atlantic region. The Church paid its
obligations promptly each month. To look at it from the outside looking in, everything
seemed fine. The un-manifested problem however was the Pastor. He felt as if the Church
failed to properly support him (though it arguably did, based on the size and income of the

He decided the best way to supplement his income encompassed receiving “Love
Offerings” each week that would be earmarked as such. This Pastor began to remove the
cash from the offerings. If any individual wrote a check for that “Love Offering” the
Pastor would simply remove that amount of cash from the collection, thereby leaving the
check to be deposited to the Church’s account.

One of the Elders approached the Pastor in love and expressed his concern for the actions
of the man of God. The Pastor defensively replied, “I bring it in. I should be able to take
it out.” Whether or not someone blew the whistle, or it was the result of other issues, the
IRS began their audit.

When the IRS showed up and indicted him on five counts, one of which included illegal love
offerings, the Judge and jury would not accept the Pastor’s arguments. The Pastor
discovered himself in a “prison ministry” of which he had no desire or anointing to fulfill.
He went to prison!

Legal versus Illegal

Every Pastor I know is elated when they receive the proverbial “Pentecostal Handshake,” i.e. money placed into their hands. Often these warriors of the Gospel received different types of cash as part of their operations and activities. These cash payments could consist of contributions, “love gifts,” honorariums, cash donations or donations of items or property. It is vital for ministers to understand the terms and what such payment may represent under IRS regulations.

For something to be a true “gift” and considered a nontaxable event, it must meet several
criteria that are outlined under the original Duberstein case. That with which God
desires to bless you, may curse you if not transacted properly. What you do not know can
hurt you!

Not all “Love Offerings” are taxable, but many of them are. It is when the Pastor,
minister, or Church does not know the difference that it creates conflict that may lead to
penalties or possible imprisonment. Just because a “Love Offering” is made as a
charitable contribution to a church or tax-exempt religious ministries does not constitute
it as a tax-free gift to ministers or Pastors.

When “Love Offerings” are formulated properly they can be tax-exempt. Herein lies the
problem – most Churches, Pastors, and ministers do not know the difference between
demarcation lines of legal or non-legal.

What Does God Say?

God wants to bless His people, especially those serving in front-line ministry. 1 Timothy
5:17-18 declares, “Let the elders that rule well be counted worthy of double honor,
especially those who labor in the word and doctrine. For the Scripture says, ‘Thou shall
not muzzle the ox that treads out the corn. And, the laborer is worthy of his reward.’”
Since God desires for ministers and Pastors to be financially blessed, to whom does the
responsibility lies to see that they are blessed? Galatians 6:6 answers this question. “Let
him that is taught in the word communicate [become a partner] unto him that teaches
in all good things.” It is the responsibility of anyone, taught by the man and woman of
God, to bless those in ministry.
However, there is a command that is from the mouth of our Lord that we must heed. Jesus
declared in Matthew 22:21b that we are to “. . . Render [give] unto Caesar [the
government] those things which are Caesar’s [the government].”
God desires that ministers and Pastors be financially blessed by others, but we must do it
the right way (Rom. 13:1-2; Heb. 13:7).

The Last Word

As the ultimate organization in our field, Chitwood & Chitwood eighty one years of experience
has placed us at the highest echelon in protecting Churches, Pastors, and ministers.
We are number ONE in our field. Anyone who has begun a new Church or is considering forming a new Church-solve your compliance issues at the outset by starting Church right. It is easier to end right if you start right.

This is why every Pastor, Pastor’s Spouse, and Church Leader should attend the next
Church Management Conference where you can gain access to the valuable knowledge
as to which “Love Offerings” are legal and which are not. We will show you the proper
methods for establishing “Love Offerings” inside and outside of the Church setting.
Legal blessings are always better than those that are not! As the best in America, we
have only your best interest at heart. To register for the next conference please call 800-
344-0076 or visit us online at

Every moment you delay places you in jeopardy of penalties and maybe criminality. Go
to and register for a Clergy Tax and Law Conference near you.

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