Chapter 3 Summary: Fundraising & Donations

Download the Fundraising and Donations Legal Checklist and identify action items for your organization.

Legal Checklist: Fundraising & Donations

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1. In Washington, nonprofits that solicit members of the public for donations and raise at least $50,000 annually or pay anyone to carry out the activities of the organization must (1) register as a Charitable Organization and (2) file yearly reports with the State.
2. Certain donations require written acknowledgement for the donor to be able to take a tax-deduction.
3. In some cases, donors may restrict how their gift can be used. An endowment is one kind of restricted gift.
4. A number of laws impact how an organization can raise money, from holding a raffle to serving alcohol. Disclosure requirements apply to nonprofits.

• For donations received, does your nonprofit have a system for written acknowledgements that meets the required elements outlined in this chapter?
• If your nonprofit has funds with donor restrictions, do you know what the tracking and accounting requirements are? Is your organization following through on required tracking?
• What are your major fundraising activities? Do the activities involve alcohol and/or gambling, and if so, is your nonprofit staying compliant?

• Review your nonprofit’s current process for written gift acknowledgement. Use the following resources to check that your organization’s approach meets IRS regulations.
  • National Council of Nonprofits – Gift Acknowledgements: Saying ‘Thank You’ to Donors
  • IRS Charitable Contributions – Substantiating Charitable Contributions and Quid Pro Quo Contributions
• Review Propel Nonprofits’ Managing Restricted Funds resource to gain a deeper understanding on funds with and without restrictions.