Nonprofit Questions & Answers - Fundraising


Telling the Truth About Fund Raising Costs

You know that donors want to believe that all of their dollars are going to support mission-focused program activities. You also know that you need to spend donor dollars to support fund raising programs. The challenge is defining what is and is not included in the category "fund raising cost" on your IRS Form 990. This isn't an issue only for accountants, but one that Executive Directors and Fund Development staff to consider. Read our guidelines about about how to define fund raising costs so you tell the truth in your financial statements so you can do the right thing in the Accountability Section.

Where can we find information about funders?
  • In Oregon the best resource is The Oregon Foundation Databook. It is available at many libraries or you might ask other organizations if they have a copy you can borrow.
  • The Foundation Center provides a lot of helpful information and links to many foundations.
  • The main branch of the Portland Public Library has a Foundation Center Collection that includes books on funders, grant writing resources and access to a national database, GrantSelect that allows user to search for funders using specific criteria. There are additional Foundation Center Collections in both Oregon and Washington.
Where can we learn about grant writing?

There are many resources that will fit most budgets and most learning styles.

Classes/workshops

There are a variety of local and national resources available.

Probably the best way to learn is by doing. If you would like some coaching you may want to hire an experienced grant writer to review your work.

Books

Our favorite is Grassroots Grants by Andy Robinson. It is inexpensive, straight forward, easy to understand and has good examples.

Tutorials

Take a tutorial on The Foundation Center web site.

The library has a grants collection that contains books on grant writing, books listing grants, software to search for grants and a librarian who will help orient you. Check your local library to see what they might have to offer. Click here to go to the Multnomah County Library grants collection website.

What kind of fundraising can we do before we have tax-exempt status?

There are ways to raise funds while you are waiting for your determination letter. You may:

  • Hold fundraising events where participants do not expect to receive a tax-deduction for any money they might spend. Examples: a benefit dinner, a benefit performance, a garage or bake sale.
  • Work through a fiscal sponsor. See the Tax-exempt Section for more information about fiscal sponsorship.

There is no problem with people giving you a contribution as long as you are clear with them that you do not yet have tax-exempt status and cannot guarantee that their contribution will be tax-deductible. Often, friends and family are willing to take the risk.