As a fundraiser, especially if you are strong on people skills, you may not have dug into the registration and reporting requirements of your organization. In fact, you may find that subject totally unappealing!
But, it’s important to have an awareness of these two areas because your donors might ask about them, their status can impact what you can and can’t legally do in fundraising, and you want to have the assurance that your organization is fully compliant so you can approach your supporters with confidence.
Some of the registration and reporting things to familiarize yourself with are:
- State registration: Many (but not all) states require a nonprofit organization to register before it begins soliciting donations from residents of that state. This registration is often – but not always – done through the Attorney General’s office, and involves paperwork and payment of a fee. There may also be some disclosure requirements (like those State disclosures you often see on the back of a reply form or envelope in a direct mailing). Failure to maintain current registration can result in a “cease and desist” order stating that you cannot solicit donations from residents of that state until you get your registration up-to-date. There are penalties for not registering, up to and including jail time. For these reasons, as well as being truly professional as a fundraiser, you want to be sure your organization is in full compliance with all necessary state registrations.
- City and County registrations: Some larger cities and counties also require registration of charities. This may be done by filing a form with a government office such as the Sherriff’s or Police department. Again, there is generally a form to file and a fee to pay. There may be required disclosures you have to include in mailings, display in your office and/or provide to your door-to-door solicitors.
- Registration to offer and solicit Charitable Gift Annuities (CGAs). Many – but again, not all – states require nonprofits to register to offer Charitable Gift Annuities in that state, and may have other requirements such as bank account locations, the amount of money that needs to be on deposit to secure the CGAs, etc. Before including CGAs in your planned giving program, be sure to check the requirements of the state(s) in which the donors to whom you will be offering them reside.
- All nonprofits over a certain size are required to file an annual report with the Internal Revenue Service. We’ll take more about that in a later post. You may also have to file reports with the State in which you are registered.
No fundraiser wants to be hindered in fundraising by a lapsed registration form, or worse, be embarrassed in front of donors by an overdue renewal. As a fundraiser, get in the habit of understanding these requirements and staying informed about your organization’s compliance, and you will be able to enjoy the work that you really love – fundraising.