Benevolence Fund Meaning Process Guideline

Benevolence Fund Meaning

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Benevolence Fund Process

Firstly the benevolence committee is to be created, but if the committee is not created, the board of directors is responsible for creating a benevolence policy and looking after it.The benevolence committee is accountable to the board of directorsBoard Of DirectorsBoard of Directors (BOD) refers to a corporate body comprising a group of elected people who represent the interest of a company’s stockholders. The board forms the top layer of the hierarchy and focuses on ensuring that the company efficiently achieves its goals.
read more, ultimately for drafting and creating the benevolence policy.

The individuals or the families who want to seek assistance from the benevolence fund are required to follow the below steps:

Firstly, the individual or family members must obtain and submit the application form for assistance from the church.The required documentation should support the form.Then the interview or the appropriate counseling must be completed with the concerned authorities.Lastly, all the additional information and documents asked by the concerned authority must be provided.Then the authorities will review the application and approve and communicate the amount of assistance to the one seeking assistance as early as possible.

Qualifying for Benevolence Fund

The purpose of the need should be well defined, i.e., for what kind of needs fund will be provided, such as food, shelter, utilities, etc.Define the financial criteria under which a recipient can get the payment of funds such as unemployment or income below the specified limits.It should be pre-decided who is responsible for approving the expenditures from funds like the designated minister or committee.Further, it is advisable to make payments directly to the vendors to whom the person seeking assistance owes rather than transferring the amount to the designated person directly to ensure that the funds are not misappropriated.The records should be maintained related to the spending of funds and the person to whom the funds are given.

How is it Distributed?

The benevolence fund is the lender in last resort, i.e., when all the possibilities of getting funds are ruled out like savings, investment, and the family, it is intended as a source of finance at the time of hardships. The disbursement of the benevolence fund shall not be in the form of any loan. The persons seeking financial assistance should be ready to take the appropriate counseling before approval; the Deacons will make sure that the person seeking assistance will not have any negative or irresponsible behavior and is not intended to misspend the funds.

The disbursements of this fund shall be made directly to the party to whom the designated person owes the amount and not to be payable as cash so that the misappropriation of funds can be avoided.

Taxability

The benevolence payment that is made to an employee is taxable as employees’ wages. Therefore, the payroll taxesPayroll TaxesPayroll taxes are statutory deductions made by the employer from an employee’s regular salary and wages, and usually, such withholdings mostly have both employer and employee equal contributions. These taxes are collected by tax authorities from respective employers and paid for human welfare schemes, infrastructure development.read more are to be withheld from them, and the same rule is applied to any other expense, which is paid on behalf of the employee.

Also, for donors, pass-through donations are not tax-deductible. Still, if the donations are routed through the benevolence fund, the church has control over the donation that makes the donation tax-deductible.

The benevolence fund is needed to help the church members or the nearby community in their difficult times. The benevolence fund is used to pay high medical bills and other expenditures important for the member’s survival or another individual.

Guidelines of Benevolence Fund

The benevolence expenditures must meet a minimum of two requirements – Need and Recipient resources.

The need is important to survive. Still, the need is defined in the church policy. Therefore, it is upon them what they include in the definition of need, i.e., policy should include what type of needs are eligible for getting benevolent payments and who is responsible for deciding what kind of need the church may assist.