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The Church Audit Procedures Act – Part Two

In Part one of this series, we examined the basics of the Church Audit Procedures Act.  In this Part, we are taking a look at what measures a church can take to be prepared in the event of an IRS examination.  These steps are not just to ward off the IRS, but are just good, basic business practices.

First, understand that there is not a high risk of your church being the subject of an IRS examination.  Although the IRS does not disclose such data, it is estimated that fewer than 100 churches per year are examined.  Those subject to such audits are those examining the most conspicuously bad behavior.  There is a higher chance that the Department of Labor would examine a church for violation of the Fair Labor Standards Act, but that is a topic for another time.

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