- Employee Retention Credits (ERC) & COVID stimulus for churches
After struggling with the emotional and financial impacts of an international pandemic for over a year, churches and nonprofits are turning their attention to the Employee Retention Credit (ERC) for additional help and support. The Employee Retention Credit, under the CARES Act, encourages businesses to keep employees on their payroll by providing a tax credit of up to $33,000 for each employee when a business has been financially impacted by COVID-19. Is your church prepared to obtain — and retain — ERC funds? To find out more about ERC funds and how to qualify, Church Executive partnered with Phoenix-based Stenson Tamaddon, a consulting firm specializing in compliance and specialized accountancy, to host the webinar: “Employee Retention Credits, ERC and COVID Stimulus for Churches.” Stenson Tammadon offers top-quality compliance and specialized accountancy services related to the CARES Act and has helped more than 2,100 businesses retain $500 million in stimulus funding. Its proprietary industry-leading platform has been licensed by nearly 200 accounting and CPA firms coast-to-coast. Stenson Tamaddon’s professional done-for-you submission services and comprehensive supporting schedules are designed to ensure your organization’s loan forgiveness application is audit-ready and accepted the first time. Leading the presentation was Stenson Tamaddon CEO Eric Stenson, joined by Stenson Tamaddon partner Aaron Tamaddon and Senior Vice President Ryan Rowland. During the webinar, Stenson discussed how churches can claim up to $33,000 per employee in ERC funds, how to qualify for these funds (even if your church did well during COVID), how a Lutheran church and school was able to secure $664,000 worth of stimulus, and how “white glove service” can get your church the funds it needs. Begin with the basics Stenson started the presentation by introducing the stimulus program and its background. Created as part of the CARES Act, Section 2301 allows “eligible employers” an employee retention credit, equal to 50 percent of “qualified wages” paid to each employee for each calendar quarter during the COVID-19 crisis. The ERC is a fully refundable payroll tax credit, meaning that even though it is claimed against payroll tax, the amount of the credit may exceed the actual payroll taxes due. As a result of the legislation, eligible employers can now claim a refundable tax credit against the employer share of Social Security tax equal to 70% of the qualified wages they pay to employees after December 31, 2020, through June 30, 2021. Qualified wages are limited to $10,000 per employee per calendar quarter in 2021. Thus, the maximum ERC amount available is $7,000 per employee per calendar quarter, for a total of $14,000 in 2021, according to the IRS. “As an example, one of our more recent clients was a Lutheran Church,” Stenson explained. “We first assisted this church with their PPP loan forgiveness. They had a PPP loan for about $600,000. After we did their PPP loan forgiveness, we were able to file three amended returns for 2020 and get the church another $327,000. So that’s the $600,000 on the PPP and then another $327,000 — almost $330,000 — in a check for the ERC. And that’s cast for the 2020 calendar year. For this year, we believe that we’re going to be able to deliver to this church over a million dollars.” According to Stenson, when combined with the PPP, the 2020 ERC and the 2021 ERC claims could result in about $2 million for a relatively small church. “The amount of good that they’re going to be able to do in their ministry with those funds is incredible,” Stenson said. “From delivering new childcare services and daycare services, to being able to expand their reach within the community, helping people in need, stabilizing the church financials, and creating long-term funds, this is money that’s really going to help this church.” According to Stenson, it’s important to note that unlike PPP loans, ERCs do not have any restrictions on the use of proceeds. However, if a business decides to claim both the ERC and the PPP, there are restrictions regarding payroll allocations. “There are some behind-the-scenes schedules that need to be created and calculations that need to be done to avoid what’s known as ‘double-dipping,’” Stenson said. “As you pay employees, we create an Excel workbook that designates payroll dollars towards one of the programs, either ERC or PPP, and we make sure that we maximize the money going to your church.” Stenson Tamaddon uses software developed for PPP to help companies maximize their ERC potential by taking these considerations into account. Because of the complex calculations, evolving landscape, and interactions with other stimulus programs like PPP, Stenson notes that the best choice might not be to rely on your church’s primary tax accountant. Who is considered an Eligible Employer for the ERC? According to Stenson, one of the most frequent questions his firm gets concerns employer qualification. “We talk to dozens of churches and synagogues and nonprofits and other businesses on a daily basis,” Stenson said. “And we frequently find that people will self-disqualify their institution or their business from ERC credits. They just feel like it’s too good to be true.” LISTEN TO THE WEBINAR! > “Employee Retention Credits (ERC) & COVID Stimulus for Churches” Available now at www.churchexecutive.com/webinars Stenson explains that while most businesses were impacted by COVID-19 in some capacity, not everyone experienced a severe revenue dip and, as a result, businesses often assume that they won’t qualify for ERC funds. However, the ERC is not narrowly directed towards small businesses, but instead available to eligible employers operating a business that meets one of the following: • The operation of the business is fully or partially suspended during the calendar quarter due to orders from an appropriate government authority limiting commerce, travel, or group meetings due to COVID-19. • The employer experiences a significant decline in gross receipts when comparing quarters between 2019 and 2020. • Employees are paid on a W2 basis (employees paid on a 1099 basis will not qualify for ERC funds). “While these may seem like Read More >
- Collaboration is key
One of the most challenging aspects of growth in a church can be the preparation and coordination of balancing space needs with financial means. After all, the physical building can mean so much to your church family. You want to have a certain feeling when you walk in the building. You want the building to project the heart of your church and meet the physical demands of a growing ministry at the same time — all within a budget that is reasonable. Building a new worship center requires expertise in many fields to come together. A large building project has many moving parts, and between an architect, a contractor, a lender, a campaign manager, and your leadership team, everyone has an important part to play. Preparing for that — and managing through it, often for well over a year — can take hours of a church building committee’s time, and in many cases, the “point person” on the project becomes overburdened with a role he or she might not be prepared to embark upon. Clearly, the “building” part of this process is only one leg of the journey to a new facility. Who will pay for this dream of ours? Do we need to borrow to make this happen? How much can we raise from our church family? How does this all fit into our church vision and mission? Understanding the capital stack projection These questions often require your team to develop a strategy that involves a “capital stack” projection. Think of it as a pyramid that starts with cash on hand, then fundraising, and finally borrowing. This capital stack can help you see the vision you have for your project come to fruition. It can also help your congregation have buy-in and confidence in your project completion. If that all sounds overwhelming and exhausting, you are not alone. Without a proper team in place, many church projects are approached with a very fragmented system that has each of the important components of your project operating independently of each other. • The architect draws the plans based on your dreams and needs for the space. • The capital campaign company works to raise funds for your church without knowing what the cost of the building will truly be or if there is a need for financing. • The bank — often brought in last — provides a loan offer that might or might not be what you need to achieve the full funding of your church project. There are many opportunities for failure in this model — too many holes in the process that could leave your church stuck waiting for funding or even divide your church family because of lack of progress. Financing should never be your last step The earlier you speak with a lender, the better off you are. You need to choose people who understand church lending and want to work with your organization. It’s best for your church to be prepared to present your financial information to your congregation as well as to potential donors and lenders to get your project fully funded. Some questions you might have as you look toward the future of your church construction project: • Do we have someone on our team with the right skills to prepare us for the next step, financially? • Who is going to make sure our project is financially viable? • Who will speak to the bank if a loan is needed? • Who will have the best interest of our church in mind as we negotiate our loan terms? • What banks even work with churches? It might be wise to engage a professional to assist you in getting financing for your project to handle these questions. This is not a mortgage broker, but rather a true financial consultant who helps your church balance the needs of the church with the demands of a construction project. This consultant should be someone who can lead the team of experts you need to make a church construction project successful, with the church’s best interests as the priority. This consultant will work closely throughout the entire project with the rest of your professional team — meaning the architect, your general contractor, your capital campaign manager, and your financial consultant / lender are all on the same page the entire time. With some careful planning and the right financial consultant, your church’s future goals can be well within reach.
- Q&A: background check basics
Professional advice on what’s required for volunteers versus staff For many churches, a background check is the only line of defense employed when screening volunteers and staff. Is it enough? Brian Gleason: A background check is a best practice in searching for any previous convictions since previous behavior is the best indicator of future behavior. However, the research done by organizations like MinistrySafe indicates that 90 percent of offenders never encounter the justice system. In addition, background checks often provide very limited information. This is especially true for younger applicants and those who are migratory. In contrast, what does a truly comprehensive screening and background check process look like? Gleason: The first step is to thoroughly screen the backgrounds of all employees and volunteers. Applicants with good intentions will not be offended, and the process often scares off unwanted individuals. 1) Written application — All persons seeking to work or volunteer should complete and sign a written application. The application should request basic information from the applicant and inquire into previous experience working or serving in a similar capacity (if the position involves working with children, you will want to have specific questions devoted to the applicant’s experience with children), previous affiliation with organizations, references and employment information and disclosure of any previous criminal convictions. The application form should be kept confidential and on file. 2) Personal interview — Upon completion of the application, schedule a face-to-face interview with the applicant to discuss his or her suitability for the position. 3) Reference checks — Before permitting an applicant to work or serve, check at least two of the applicant’s references. These should include professional references as well as personal or family references, preferably from organizations where the applicant has worked in a similar capacity. If the position calls for working with children or vulnerable individuals, you will want to contact the individual’s references to determine the applicant’s history in working with children. Keep the results of the reference checks confidential and on file with the individual’s application. 4) Criminal background check — After securing the proper permissions, you should conduct a background check of the applicant. That background check should include the National Sex Offender Registry as well as a criminal history for any county in which the applicant has lived for the previous seven years. Exclude individuals with a criminal history that includes any violent offenses or offenses that victimize children from contact with minors. Like the application and the reference checks, you should keep the results of the criminal background confidential and on file. 5) GuideOne customers have access to discounted background check services through our relationship with preferred providers. For more information, please see our Human Resource Services Landing Page at www.guideone.com/HRServices. Do your screening / vetting recommendations differ depending on if a person is a staff member or a volunteer? Gleason: We recommend thoroughly screening all individuals who will potentially interact with children or other vulnerable individuals regardless of the employment relationship. However, we recommend that organizations discuss this with local counsel as state employment law might limit or clarify certain parts of the screening process. For example, in some states, employers may not legally ask applicants about their criminal history on an employment application. Likewise, do your recommendations differ depending on the role each person will serve? Gleason: The risks associated with working with children and vulnerable individuals and the potential for misconduct mandates that the screening process should become more thorough and comprehensive. Risk increases when frequency of contact increases and accountability decreases as power and control increase. In a church setting, for example, the screening process for a children’s pastor who might have daily personal and private interactions with children should be more comprehensive than that for the volunteer who serves snacks or paints faces at the annual carnival in the middle of the parking lot once each year. What advice do you have for selecting the best possible background checks provider? Gleason: We would recommend thoroughly reviewing the abilities, accreditation and compliance of any provider. It is also important that they be able to provide you with timely and accurate information in a format in which you can digest it. For small organizations, individual reports provided as needed might work. For larger organizations, it might be important to work with a provider that can return information through an electronic dashboard. Keep in mind that you typically get what you pay for. While cost is a factor, selecting the inexpensive option that doesn’t truly give comprehensive results could result in problems in the future. For existing volunteers and staff, should background checks be instituted retroactively? Gleason: Thoroughly screen all employees and volunteers who interact with children or other vulnerable individuals. This is true even for those who have been serving previously. Be transparent with the employee or volunteer. We recommend that the discussion focus on the safety of all that the organization serves. While it might be possible to streamline the reference checks and personal interviews of long-term employees and volunteers, it is critical to secure a criminal history for all who interact with children. It will help if written application and background check materials are clearly stated and easy to complete. In some cases, much of this information can be provided online through a portal provided by the background check vendor. Once a staff member or volunteer is screened and brought onboard, should they be re-screened at some point? Gleason: Making a reasonable effort to access past criminal records has become a standard of care in child-serving organizations, and a criminal history check should be performed on all employees and volunteers on a regular cycle. Many industry leaders recommend checking every two years, but some child-serving organizations (including preschools and daycares) in some states are subject to licensure requirements which require more frequent updates. — Reporting by RaeAnn Slaybaugh
- SANDY THAILING & CHURCH OF THE RESURRECTION: Maximizing the video team’s creative potential — despite COVID challenges
Content creation without barriers By RaeAnn Slaybaugh Having worked with Church of the Resurrection (COR.org) in Leawood, Kansas, in some capacity for more than 20 years, it is safe to say Sandy Thailing knows everything there is to know about its video production setup. Aside from his extensive work with this very large church, Thailing began his career freelancing on the Branch Davidian trial for CourtTV which has led to a lot of corporate production in Dallas, as well as the Kansas City metro area. So, when the time came to take the COR video production team’s output to the next level, he knew how instrumental a more efficient, accessible collaborative media storage system would be. And that would require finding just the right media server and storage-unit elements. Last summer, Church of the Resurrection Video Production Manager Sandy Thailing was well underway in his search for collaborative media storage options when Senior Executive Director Dan Entwistle passed along a Church Executive article: “Storage made for Sundays.” Coincidentally, it spotlighted solutions from creative.space that are designed to be “as simple to use as an iPhone and ideally suited to churches.” That caught Thailing’s attention. “Our main goal was to have on-premise shared storage for our video editors to access and edit from, eliminating local RAID storage that filled up pretty fast over time,” he says, referencing the use of Redundant Array of Independent Disks, a data storage technology that combines multiple physical disk drive components. His reasons were good: each local RAID unit held eight to 24 terabytes, and each editor had their own RAID array connected to their Mac or desktop. “So, we would do some sharing, but it was always a little bit convoluted,” Thailing explains. “We had to give certain permissions to connect and share media, which meant our machines always had to be on even when editors weren’t at their desk.” Consequently, the church’s methods for moving media around in the past could best be described as a “sneaker net.” Content creators, editors and producers ferried flash drives or USB sticks from editing suites to control rooms instead of using the existing network. “Most of the time, it was just easier to do it that way,” Thailing admits. Accordingly, this meant video content was stored in several different places — not at all centralized. “As each RAID filled up (fast), we’d have to buy a new one and the old one would sit on a shelf,” Thailing adds. “So, it was tough to know where all the media was. We didn’t have a good library because we haven’t really gone down the file / data asset management route yet.” Technology guided by faith A member of Saddleback Church for nearly 20 years, Sean Busby, president and co-owner of DigitalGlue and creative.space, says the release of Rick Warren’s The Purpose Driven Life impacted him hugely. Given his 24/7/365 business commitments — servicing the broadcast television network industry with customers like FOX News, The CW, Trinity Broadcasting, and American Forces Network — Busby volunteered at the church in the only way he could manage: parking cars. In 2003, a friend introduced him to Life.Church pastor Bobby Gruenewald, who was committed to simultaneously sharing the sermon given at the main campus with two new locations. “I immediately realized we were on the same mission,” Busby says. Later that year, the Life.Church satellite network was up and running. Soon, others — Mars Hill in Seattle; Lake Pointe Church in Rockwall, Texas; and Church Unlimited in Corpus Christi, Texas — inquired about building the same type of network. But there were only so many churches intent on going this expansive. Fast forward to now, with Busby’s offering of the entry-level //ROGUE PRO server for on-premise storage and the portable //ROGUE enterprise-based video storage system that can live on the editor’s desk at church or at home. Since churches’ annual budgets are primarily based on the previous year’s giving, creative.space’s flexible contacts and all-inclusive monthly or annual OPEX payment structure are a huge appeal for houses of worship like Church of the Resurrection. Customers pay a flat monthly or annual rate that includes hardware, software, and 24/7 proactive support, and contracts are offered in one-, two-, three- or five-year options with the ability to lengthen or shorten the term as needed. For a limited time, the 96TB //ROGUE PRO starts at only $495 per month (usually $595 per month). The portable //ROGUE is the only unit available for one-time purchase starting at $4,795 for 48TB. “With these tools, a church’s video team is finally able to collaborate quicker, producing better and more content than ever before at a price that has never been possible,” he explains. “For me, that incredible feeling of giving back, is back.” Enter: COVID When Coronavirus struck, the need to “build a better mousetrap” became even more pressing. Pre-pandemic, the workload was already significant. Most important, Thailing and his team of four video producers — Greg Hoeven, Natalie Cleveland, Kersee Meyer and Cam Hershberger — produced content for the weekly sermon for Senior Pastor Adam Hamilton. They also created video content for live worship; produced a weekly online service (in both modern and traditional formats); and provided support for the rest of COR’s ministries — from missions, to kids’ discipleship, to youth programs. Additionally, they helped produce DVD-based books for ministry staff who are also published authors. Once COVID-19 hit, Thailing and his team were asked to ramp up production in a big way — and a lot of it would need to be done from home. To ensure continuity and engagement with church members, they would produce a weekly live-switched podcast in their small studio, as well as a handful of live-streamed conferences. The production of worship services would also be significantly elevated; pre-COVID, these two live streams were presented as if someone was simply watching the service in the sanctuary. Now, their TechnicalArts ministry would deliver full-production-value products: four different versions of Read More >