Difference between revisions of "Basics for Seeking Grants and Other Funding"
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==In USA, recognition as a legitimate charity== | ==In USA, recognition as a legitimate charity== | ||
| − | In order to be recognized as a charity in the United States and receive tax-deductible money, such as grants, | + | In order to be recognized as a charity in the United States and receive tax-deductible money, such as grants, the organization has to be registered and recognized by the Internal Revenue Service (IRS). Foreign non-profits also should get recognition as a 501(c)(3) charity by the IRS. The process for foreign NGO’s is the same as for nonprofits based here in the United States. U.S.-based foundations that provide money, such as the Ford Foundation or Rockefeller Foundation, have to be very careful to check where their money is going, especially with concerns about terrorism and NGOs affiliated with terrorism. |
Essentially, the United States government has to recognize an organization as being legitimate and as doing something charitable before it will give corporations or individuals tax credit for giving money to that organization. Foundations in the United States only give large amounts of money to legitimate organizations that are registered and recognized. For foreign corporations, you can be located outside of the United States, but you have to be registered and recognized by the IRS. | Essentially, the United States government has to recognize an organization as being legitimate and as doing something charitable before it will give corporations or individuals tax credit for giving money to that organization. Foundations in the United States only give large amounts of money to legitimate organizations that are registered and recognized. For foreign corporations, you can be located outside of the United States, but you have to be registered and recognized by the IRS. | ||
| − | For example, | + | |
| + | For example, a donor needs the IRS to know that your organization is legitimate, that is not a front for a government organization nor a front for a terrorist organization, such as al Qaeda. Money given directly to a government is not tax-deductible for a donor. Likewise, the U.S. government, at a U.S. treasury website, http://www.ustreas.gov/offices/enforcement/key-issues/protecting/fto.shtml and http://www.ustreas.gov/offices/enforcement/key-issues/protecting/charities_execorder_13224-a.shtml, lists organizations to which contributions are prohibited by executive order, as a result of being designated organizations connected with terrorist groups or supporting them. In essence, your relationship with the IRS is for the sake of the donor. | ||
This is in reference to receiving funds from a U.S. foundation. It is another situation if the foundation is located in your country. For example, if your NGO is located in India, you can seek grants directly from the Ford Foundation in India, through their own offices, and not have to register with the U.S. government. This means those assets in the Ford Foundation in India are Indian assets, and you are working through the Indian government in terms of those grants. | This is in reference to receiving funds from a U.S. foundation. It is another situation if the foundation is located in your country. For example, if your NGO is located in India, you can seek grants directly from the Ford Foundation in India, through their own offices, and not have to register with the U.S. government. This means those assets in the Ford Foundation in India are Indian assets, and you are working through the Indian government in terms of those grants. | ||
| − | The issue is dollar | + | The issue is dollar or goods going across borders. If your organization is only looking for resources, such as “We want doctors to come and serve our children,” or “We want teachers to come to our country and teach,” it still holds that if you are recognized as legitimate by the IRS, it makes it easier to get that kind of resource. The process for recognition is to apply for a 501(c)(3) tax exempt status from the IRS. |
| − | ==Programs and | + | ==Programs and budget== |
It is important to understand that most people, corporations, governments, foundations and individual owners give very specific programs, not general organizations. Once your non-profit is considered a legitimate organization, has a correct legal structure and is recognized by the IRS, the next important process that your organization has to do, before you ask for money, is to plan and articulate what it is that is going to be achieved. What are your programs? If you are writing a literacy program for youth, how many people are involved? What towns or villages are you visiting? How many children are going to be affected? How much is it going to cost? What do you do? | It is important to understand that most people, corporations, governments, foundations and individual owners give very specific programs, not general organizations. Once your non-profit is considered a legitimate organization, has a correct legal structure and is recognized by the IRS, the next important process that your organization has to do, before you ask for money, is to plan and articulate what it is that is going to be achieved. What are your programs? If you are writing a literacy program for youth, how many people are involved? What towns or villages are you visiting? How many children are going to be affected? How much is it going to cost? What do you do? | ||
Revision as of 08:58, 3 September 2008
For a nonprofit organization to fundraise successfully, there are foundational steps that must be in order first. These basics, such as governance structure and recognition as a legitimate nonprofit, come prior to the issues of addressing how to ask for money and where to get it. People and foundations do not just hand out money; Ted Turner is not going to walk up to your door with a briefcase full of a million dollars and the Gates Foundation is not going to be inspired by the name of your organization and bank wire funds. Organizations need to have certain things in line, legal and otherwise. This article provides an overview of these foundational steps that must be in place before asking for money.
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