COVID-19
  • 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 >

Leadership
  • Minimizing interest expense, maximizing ministry

    A commitment to consistent financial stewardship — and the guidance of a like-hearted lending partner — enabled Blackhawk Church to set a course for debt elimination. By RaeAnn Slaybaugh For the finance team at Blackhawk Church in Madison, Wisc., solid financial stewardship is a priority. Led by Director of Accounting & Administration Jon Mueller and Director of Operations Darren DeKeyser, a team of volunteers — which ensures an extra layer of accountability — makes it a point to periodically assess Blackhawk’s existing debt structure.  The team was aware that loan rates were dropping and were lower than the church’s existing rates, which were fixed. They wanted to take advantage of the historically low-rate environment to secure a long-term fixed rate loan. “Our existing financing was flexible, allowing us to proceed,” Mueller recalls.  So, the goal quickly became to secure a more competitive long-term financing package. And if doing so could also help the church establish a trusted relationship with a lender to accommodate future growth, then that would be ideal. Blackhawk reached out to several national church lenders and a regional bank to understand what (better) terms might be available. Most lenders would fix the interest rate for five years, but Blackhawk was interested in fixing the rate for a longer term. In the end, Thrivent Church Financing — which was recommended to the church by a capital stewardship partner — was able to meet the church’s needs, presenting Mueller, DeKeyser and team with a number of rate and term options. But it wasn’t just a matter of meeting the church’s financial needs; this lender also appeared to not just understand, but share, the church’s ministry objectives and culture.    Case in point: COVID The past few years have presented several unique challenges to securing church financing: namely, uncertainty. Blackhawk wasn’t exempt from these concerns; but flexibility, along with planning and foresight, made them surmountable. COVID was in full swing when the church began its conversations with Thrivent Church Financing. However, by quickly adapting and providing online services, engaging small groups, encouraging electronic giving, and maintaining a servant attitude, Blackhawk has maintained its financial strength and momentum throughout the pandemic.  Importantly, as DeKeyser points out, the church was committed to showing this flexibility to its lending partner if it helped. He and the team were prepared to share what contributions looked like over various periods in time, as well the plans enacted to minimize immense financial uncertainty. But that’s not all Blackhawk had on its plate at the start of this new lending relationship: it was also in the midst of a planned senior pastor transition plan. Here again, transparency was critical.  “We understood that the senior pastor transition would be a part of our conversations and the lender’s discovery,” Mueller says. “We described Blackhawk’s existing structure and what it would look like in the future. Thrivent leadership was also able to observe transition videos and speak directly with the exiting senior pastor.”  In these ways, Mueller says, Thrivent Church Financing was able to observe a “healthy, well-planned transition” that would not negatively affect the relationship moving forward.  Freeing up funds Blackhawk now enjoys more financial flexibility all-around, having successfully minimized interest expense, while maximizing ministry investment. Across the board, budgets — which were reduced at the pandemic’s outset — have been increased. “While the overall budget has been relatively flat, the reduction in interest expense and the fully amortizing loan allowed for the deployment of dollars historically allocated toward principal and interest across other areas of the overall budget, including ministry,” DeKeyser points out.  When the pandemic draws to a close, he says the church expects the full effects of refinancing to continue. At some point, when the debt is completely paid off, those resources will be infused into the ministry. “The Kingdom benefits when the Church is debt-free”    Thrivent Church Financing shared this guiding principle, and Mueller, DeKeyser and team understood the long-term benefit of aligning under this value. “On more than one occasion, several Thrivent Church Financing staff have stated that their goal is not to burden the church with excessive debt or hamper the ministry, but to help enable the church to thrive regardless of the loan balance,” Mueller explains. “Ultimately, if the church is debt-free or reduces its principal and interest expenditures, more of its budget dollars can be deployed toward ministry and the health of the church.”

Risk Management
  • Elder fraud: What I learned from helping my parents recover from financial fraud

    By Anonymous “When I called the next day to check in, my father said that the retailer was running into issues refunding the money for the unauthorized purchase on his account. The fraud department wanted him to purchase a VISA gift card that they could load the money on to send him his refund faster.  At this point, it was clear my father was an active victim of fraud.” Day 1: It began with a text from my father saying there were some unauthorized charges on a retail website and on one of his credit cards, but he assured me he was handling it. When we spoke several hours later, he told me he had been working with the fraud department at the online retailer all day and they were helping him with all his accounts. I questioned why they were helping with all his accounts instead of just the account he had with them, but he assured me everything was OK, and the customer service person was super helpful. Day 2: When I called the next day to check in, my father said that the retailer was running into issues refunding the money for the unauthorized purchase on his account. The fraud department wanted him to purchase a VISA gift card that they could load the money on to send him his refund faster.  At this point, it was clear my father was an active victim of fraud. We would later learn that the “super guy” in the “fraud department” he had spoken with for two days and more than six hours was quietly stealing his money and identity, while remotely logged into my father’s own computer. Days 3-15: The entry point for the thieves was an email my father received confirming an expensive order from a major online retailer. In the middle of the email in red letters were the words, “If this is not your order, call 800-XXX-XXX.”  The email was a fraud ploy known as a phishing email. When my father called the 800 number, it was answered by a very nice man who said his name was Jeremy. “Jeremy” was a thief. It took some time to learn the full extent of what had been compromised, but it became clear that the risk was significant. Our first steps were to stop more damage from occurring by making critical contacts. We contacted every bank, broker, and credit card company to let them know there was active fraud and to put protections in place. During this process, we were able to identify additional breaches of my father’s accounts. We contacted the three credit bureaus and placed both Fraud Alerts and Credit Freezes on his records. The credit freeze prevents anyone from opening a new credit account without specific authorization from you.   We contacted the local police and filed a police report. There is little that local police can do, but taking this step shows due diligence when reporting fraudulent charges to your bank or credit card companies. We changed the usernames and passwords on all accounts at risk for financial fraud. Over the next two weeks, my father and I worked together in person for more than 80 hours to document and secure my father’s financial life. We both learned a lot that I hope will save you from becoming a victim of fraud and identity theft.   You can be too trusting Whether it is an email, a phone call or a text, never respond to an unsolicited communication about a bank account, credit card or retail purchase. Instead, log into your account independently and check for activity or call customer service using a number from a source that you can verify is legitimate.   If my father had called either the retailer or his credit card company directly, he would have discovered the email was fraudulent. Enable two-factor authentication Most financial websites now let you choose two-factor authentication, a feature that sends a code by email, text or voice to your cell phone which you must enter each time you attempt to log into your account. It is an extra step, but it serves two purposes; it verifies that you are the person logging into your account, and it means you will be notified if someone other than you is trying to log into one of your accounts. Strong passwords stored securely The thieves were able to gain access to my father’s accounts because he had saved his passwords automatically in his web browser — a default option in many browsers. It makes life easy for us, but once the thief had access to his browser, he had access to everything. Always use unique and strong passwords and store them securely. Disable obsolete accounts If you don’t use a credit card anymore, you might want to consider cancelling it. Same goes for old email accounts. The thieves used an old email account of my father’s that he no longer used, which allowed them to make online purchases — like digital gift cards worth thousands of dollars — and have them delivered right to his own email. That rendered the transactions untraceable, and he never knew it was happening. Finally, some good news!   We ended up creating a master document that captured all the information on my father’s financial and digital life. Each account has its own page, and we included every bank and credit account, regular bills like utilities, insurance and so on.   In addition to usernames and logins, for bills we included when they were due, how they were paid, and other important details. We also created pages for social media accounts.   In the end, we documented 37 accounts. We made three copies (in addition to a password-protected digital version), and my father, brother and I each have one that is kept secure. It means that if something should happen to my father, my brother or I can immediately manage his affairs, or just assist him if he needs Read More >

Pastor-Friendly A/V
  • 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 >

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