Total YTD revenues for the five months ending November 30 equal $13,975,000, or 89.5 percent of the revenue budget of $15,618,000. YTD expenses have been held to approximately 96 percent of the expense budget, leaving a shortfall of approximately $920,000. We have initiated a number of expense reductions in response to this critical situation. Please pray that God would provide the financial resources needed to reach lost people and make disciples.
»Click Here to see the current Great Commission Fund figures.
Year-End Giving Opportunities
In light of our current financial situation, please encourage your pastor to distribute the C&MA year-end offering envelope in your bulletin during December or visit The Alliance’s secure online giving Web site: cmalliance.org/gift.
Year-End Remittances
All church remittances received in the Finance Office through December 31, 2007, will be included in December 2007 income. Church remittances received after December 31 will be included in January 2008 income. Gifts from individual donors postmarked by December 31, 2007, and received by January 7, 2008, will be included in December 2007 income. Visit www.cmalliance.org or contact Lisa Bacon at baconl@cmalliance.org if you have questions.
Impact of Weakening U.S. Dollar on Alliance Ministry
The impact of the weakening U.S. dollar may not yet be felt by the average American consumer, but for Alliance missionaries who depend on the Great Commission Fund (GCF) for their support, the value of the dollar already is affecting their ministries. “We convert dollars to a myriad of currencies,” says Bill Ramirez, manager for International Accounting, “including pesos, rubles, reais, euros, and more. The euro is quickly becoming the core currency of international banking. Currently, the exchange rate is approximately $1.47 for 1 euro.”
The effect on the GCF because of the weakening dollar is significant. “The Alliance loses between 4 and 10 percent in the overall mission budget, depending on the country. The potential impact on the GCF is a loss that is between $500,000 and $1 million from the annual budget for the International Ministries team,” Ramirez says. “People need to give at least 110 percent of the current year’s budget just to stay even.” While operating costs and allowances based on cost of living will be reduced, the loss is not only in dollars. The greater impact—the eternal impact—is on the lives of the people who won’t hear the gospel because funds will not be available for Alliance missionaries to continue the work that God has called them to do.
Christmas Gifts to Pastors and Staff
In most cases, financial gifts made by the church or congregation to pastors and/or staff should be considered taxable income and not tax-free gifts and should be reported as income on the recipient’s W-2.
Housing/Parsonage Allowance
Your church board should approve, in writing, a 2008 housing/parsonage allowance for your pastor(s) before the end of 2007. Legislation was passed in 2002 that limits the excludable amount of housing allowance for pastors who own their own homes to “not exceed the fair rental value of the home, including furnishings and appurtenances such as a garage, plus the cost of utilities.” We recommend that this housing allowance be approved as a continuing resolution so it will not expire if the board does not consider it the following year. An example follows:
We recommend that this housing allowance be reported in Box 14 on your pastors(s) W-2 to provide a permanent record of the amount and to provide support for the resolution adopted by your church.
Standard Mileage Rates
The IRS has issued the standard mileage rates for 2008. The business purpose mileage will be 50.5 cents per mile, an increase from 48.5 cents per mile. Charitable mileage remains at 14 cents.
W-2 Reporting of Clergy Income
Clergy income is reported in Box 1 of the W-2 with all tax withholding reported in Box 2. Because clergy are not subject to FICA, Boxes 3 through 8 should be left blank. The housing allowance should not be included in the amount reported in Box 1 but should be reported in Box 14 (Other).
Donors who give individual contributions of $250 or more must have a receipt or statement in their possession for such contributions before they file their tax returns in order to deduct these gifts. The written acknowledgment must state that no goods or services were provided in exchange for these gifts. Please give these statements to your people as early in 2008 as possible. You may want to remind your congregation not to file individual tax returns until receipts or statements have been received. Donors are required to maintain a bank record (e.g., cancelled check) or a written communication from the church for all contributions indicating the church name, date, and contribution amount. This requires all cash contributions to be receipted and detailed for the donor to qualify for a tax deduction.
Church Review of Financial Records
It is highly recommended that your church have an annual audit if this practice is currently not in place. An audit ensures good internal controls and helps to maintain integrity. At a minimum, all financial records should be examined annually by at least three people, not including the church treasurer or staff members. Guidelines are provided in the current edition of the Finance Manual for Alliance Church Treasurers (and Pastors). The Finance Manual can be found in the Alliance Resource Center, www.cmalliance.org/resources/books/books.jsp.
Personal Gifts to Missionaries
Personal gifts to missionaries (birthday, anniversaries, Christmas, etc.) will be processed at the National Office as non-tax-deductible gifts and added to the missionary’s monthly allowance if received directly from individuals. Effective January 1, 2008, personal gifts processed through the local church and remitted by the church to the National Office will be processed as missionary outfit gifts. These gifts may be tax receipted by the local church but will be included in the missionary’s taxable income. This policy change aligns with current IRS requirements.
Ministry to Mission Fields
Read what one external field auditor had to say about her recent experience . . .
Do Kimberly’s words resonate with you? If so, perhaps you could join her in this unique service. We are looking for qualified individuals who would be willing to serve and perform external audits on the financial records of any C&MA field. Interested parties may contact Bill Ramirez at 719-265-2085 or ramirezb@cmalliance.org for information and minimum requirements.
Office of Employee Benefits
There will be many changes to the C&MA health plan for 2008. Many of the followings changes are a direct result of the responses received by the survey mailed a year ago.
- No rate increase for 2008
- Decreased deductibles and out-of-pocket maximums for family in-network
- Minor diagnostic services covered at 100 percent, no deductible, up to $5,000 per person
- Colonoscopy covered at100 percent in-network once every 10 years following age 50
- Mental health benefits increased to 100 percent after a $25 co-pay in-network
- Marital counseling added to mental health benefits
- Flu shots available at 100 percent through a specific vendor October–November each year
- Coverage extension for spouse and dependants of a deceased participant for 24 months
- Wellness Program will begin with the encouragement of completing a Health Risk Assessment Program
- High Deductible Health Plan will be available along with the option of an HSA
- Long Term Disability payouts increases to 60 percent up to $5,000/month
- Discounted rate offered for those 65 and over and still actively working at a church of 20 employees or less
A Roth 403(b) Retirement Plan also will be available in 2008 with the same investment options as the current traditional 403(b) plan. The Fellowship Fund contribution rate for 2008 will continue at 0.7 percent of prior years’ general fund income for churches and 1.4 percent of prior years’ full-time payroll for supporting organizations. Approximately 560 retired workers gratefully rely on your contributions. Notices will be mailed to the churches late April 2008. For further information, contact the Office of Employee Benefits for further information at 800-700-2651.
For more information, contact the Employee Benefits office at 800-700-2651, or e-mail benefits@cmalliance.org.
The Alliance Development Fund (ADF)
Does your church plant have the perfect piece of vacant land picked out for a future church site but cannot afford a monthly loan payment? Visit www.adf-inc.com/dlp to find out how ADF can help. In addition, ADF can provide funding for any church’s property purchase, building project or refinance an existing loan from another lender. For more information, call 888-878-3060 (toll free) and ask for the Church Services Group.
Thank you for your sacrificial support and prayers for The Christian and Missionary Alliance.
Ken Baldes
Vice President for Operations/Treasurer
