Cell Phone Use Policy - Why we need one?




 

One of the hottest issues today, both from a liability perspective, and from the IRS as well, is the use of Cell phones.  The purpose of developing a Church Policy on the use of Cell Phones is twofold:

  1. From a Liability perspective:   In the interests of excellence in administration, and to minimize the church’s Liability, we should develop Church Policies regarding the use of personal electronic devices while driving church vehicles, and even personal vehicles when on church business.  Several states have now passed legislation prohibiting the use of Cell Phones  and “Text messaging” while driving.
  2. From the IRS perspective:  To mitigate any concern the IRS has with the church providing a Cell Phone for the employee’s use.  If it’s permitted use is not carefully established, and it’s personal use reported as additional income, the IRS, under the auspices of “Intermediate Sanctions,” takes the position that unreported income in the form of “Benefits” has occurred.  The Ministry could face severe fines and penalties, and even the loss of the churches 501(c)(3) tax exempt status, if discovered.

Under the regulations of section 4958, the IRS can impose fines directly on the individual members of the Board of Directors and officers of the church, if they knew, or should have known, that the church violated any of the compliance requirements of the Internal Revenue code. These fines are substantial, and can be up to $10,000.00.

“NEWS FLASH” Effective April 14, 2010, this issue is a little less important to the IRS, with the passage of the Taxpayers Assistance Act of 2010, under Title I-Cell Phones and Electronic Filing  http://www.gop.gov/bill/111/1/hrdeh0093   “Removes cell phones and similar telecommunications equipment from listed property.

Prior to this, the employer-provided cell phones and blackberries were to be treated as “listed properties,” requiring employees to keep extensive records to prove that deductions are claimed solely for business use.  Any non-business related value of such listed property must be included in the employee’s income.

PLEASE NOTE that there are two important points within the following sample policy, taking it out of the arena of “Benefits provided for the employee,” and clearly defines the Cell phone’s use as a requirement by his employer.  They are:

  1. The Cell Phone is provided the employee “for the benefit of the church,” and
  2. The employee is required to carry and use it, “As a condition of  employment.

The following Sample Policy is being provided you at no cost, as a service by Administrative Assistance.  Please consider adopting this Policy at your next meeting of the Church [or ministry] Board of Directors.    IF you find this helpful, we have written  the SAMPLES Manual which contains more than 100 such Samples of Policies, Resolutions and Minutes for your church’s use.

CELL PHONE USE POLICY – Here is a FREE Sample Resolution you may use if you like.

It has come to the attention of the church Board of Directors, for the need of a policy regarding the use of Cell phones, leased by the church and provided to the pastor, [and/or any other employee].  Following are the terms and conditions under which the church has leased the Cell phone:
1. The plan is on a ____ year contract effective _______.  The cost is $_______ per month, plus applicable taxes and fees, for ______ minutes, with any extra minutes used billed at the rate of  ______ ;
2. Plan includes long distance, but does not [or does] include “Roaming;”
3. The Cell phone and plan was purchased for the business use of ____________________ ;

This Cell phone is provided by the church. and made available to ____________.  He is required to carry and use this phone during his normal hours of employment, and all other times reasonable to conduct the affairs for which he was employed.

This Cell phone is provided to the employee for the benefit of the church, and as a condition of his employment; He is required to carry and use it as described.  This Cell phone is to be used for business use purposes only, and any personal use beyond a deminimis amount as determined by the Treasurer, will be reported on his W-2 as additional income.

Furthermore, to avoid any liability on the part of the church, when driving any church owned automobile, Van, or Bus, or even his personal automobile, if on church time or business, his Cell phone (and pager and all other electronic devises used for personal communication) are to be turned off when he enters the vehicle, and remain off the entire period of time he is in control of the vehicle. If he surrenders his Cell Phone to a passenger, and a call comes in which he finds necessary to receive, he must first stop the vehicle in a safe place before conversing on the phone; or the caller is to be informed that he will return the call at a later time.  Any prior exception granted of “Hands free” use of a cell phone, is hereby rescinded.  After discussion, a  motion was duly made, seconded and unanimously carried, it was

RESOLVED, to approve and Ratify the above purchase Lease Plan, and the conditions for the use of a Cell Phone, and any other electronic devise, as imposed upon the above named church employee.

Consider inserting the following in the church’s “Employee Handbook,” or developed as a “Form” the employee is required to sign at the time of his employment.

USE OF CELL AND ELECTRONIC DEVISES WHILE OPERATING A VEHICLE.
Because of the danger, and concern for other drivers, the use of your Cell Phone, Pager, Laptop’s Fax, or any other means of personal electronic communication while driving any vehicle during the hours of your employment by ____[Your Church Name Here]____ is hereby expressly forbidden.  Violation of this Policy will bring immediate disciplinary action, up to and including dismissal for exposing this organization to a liability lawsuit.

When driving any church owned automobile, Van, or Bus, or even your personal automobile, if on church time or church business, your Cell phone (and pager and all other electronic devises used for personal communication) are to be turned off when entering the vehicle, and remain off the entire period of time you are in control of the vehicle.  If you surrender your Cell Phone to a passenger, and a call comes in which you find necessary to receive, you must first pull over and stop the vehicle in a safe place before conversing on the phone; or the caller is to be informed that you will return the call at a later time. Any prior exception granted of “Hands free” use of a cell phone, is hereby rescinded.

This Cell phone is provided without cost to you, for the benefit of the church, and as a condition of your employment, you are required to carry this Cell phone during your normal hours of employment, and all other times reasonable to conduct the affairs for which you were employed.  This Cell phone is to be used for business use purposes only, and any personal use, beyond a deminimis [minimal] amount as determined by the Treasurer, will be reported on your W-2 as additional income.

____________________      ________

Signature of Employee                  Date

__________________________
Employee Name – Please Print

_________________________    _______
Signature of Church Representative      Date

_________________________
Church Representative – Please Print

Copyright © 2007 By Administrative Assistance. This Policy is released for the use by any church.

This information is provided to help you with the process of creating your own start up materials,  for your church or ministry.  When we develop these kinds of policies for ourselves, I often contact our CPA or an attorney before adopting them.  We therefore suggest you do the same.  We are not attorneys, and are not attempting to practice law by making this available to you. We are only providing you with Church Policy samples, in the spirit of developing excellence in Church Administration.

This Policy was developed by Administrative Assistance, and is made available to you in the hopes you will look at some of the other church administration materials we have developed for the church. Our SAMPLES Manual now has more than 100 such Policies, Resolutions and Minutes.

This information is provided as a service to the Body of Christ by ADMINISTRATIVE ASSISTANCE.

If you would like more information about similar issues, please consider“The Church Administration ‘How To’ Manual” This Manual, endorsed by three CPA’s, an EA and two attorneys, was updated in January, 2011, for the 12th time, since its original publication in 1991.

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