Fiscal sponsorship’s are an option many in the non-profit sector aren’t aware of. There are many times when this arrangement can make sense. Whether it’s splitting your department off from a larger organization, looking to accept funding without gaining full tax-exempt status or a small group who can’t provide the administration support needed becoming a fiscal sponsee may be right for you.
For an in-depth analysis, including pros and cons, checkout our blog post on fiscal sponsorship.
As a 501c3 ourselves Charitable Allies (“Organization”) is able to provide fiscal sponsorship support, under certain circumstances. We can provide support in the following ways:
Basic Fiscal Support
- The Organization will receive grant funds under the Organization’s nonprofit status and transfer the funds directly to the Sponsored Organization while the application for tax-exempt status is in process with the IRS. During this time, the Sponsored Organization can receive tax-exempt donations, but some funders will only give money to organizations with their tax exemption complete.
- The Organization will receive and process all donations and provide donation letters, track funding, etc.
- The Organization accepts all liability for receipt and distribution of tax-deductible/preferred funds. The Organization is thus the grant recipient from a tax perspective and it is for the benefit of the Sponsored Organization’s program.
- The Organization will submit any grant or other donation reports necessary for funders under the Organization’s letterhead. The Sponsored Organization would prepare the reports; the Organization would do a review to ensure compliance.
- The Organization charges the Sponsored Organization 1-2% of the donations received for this service
Full Fiscal Support
- Everything in Basic Fiscal Support, plus the Organization will transfer funds to the Sponsored Organization as appropriate, pursuant to standardized accounts payable processes and as program is delivered.
- The Organization will apply testing to ensure public support for the Sponsored Organization.
- The Organization will principally prepare financial grant reports and work with the Sponsored Organization on preparation of programming grant reports.
- The Organization will actively assist with preparation of grant applications and donor development planning. Depending on the level of complexity involved in the grant applications, the Organization may charge an additional fee for assistance in drafting these applications.
- The Organization charges 10-15% of donation amounts for these services.
To review our policy regarding these engagements download the pdf below.