Non-Profit Legal Issues: Fundraising

Non-Profit Fundraising from The Startup Garage
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As mentioned in our earlier blog post on State Filing, most states require that you register with the Attorney General for the right to solicit funds within the state, and most states additionally require you to report on your fundraising revenues and expenditures.  Fundraising for a non-profit can take many forms, and below we discuss some of the legal issues that come up in the context of non-profit fundraising.


  • A possible avenue to secure funds to be available in the future is to get donors to put your non-profit in their will.  The donor can use a legal device called a codicil to amend their will to include your non-profit.  You can offer to draft the codicil for the interested donor so their only step is to complete the codicil.

Planned Giving

  • A planned gift is a major contribution that can range in form between a bequest to a trust, and involves financial advisors, tax attorneys and others who assist in the process of putting the planned gift together.  The gift can include money, stock, insurance, property or other assets, and can either be paid to the organization at the donor’s death or during their lifetime, depending on how the donor wants to structure the deductions.  Setting up a planned giving program is best done under the advice of an attorney.


  • Placing a telemarketing call from an automatic dialer to a cell phone is prohibited by the FCC, but calls from political organizations, charities or telephone surveyors that aren’t made to sell goods or services.  If you do sell products to raise funds, you may call someone who has made a purchase within the last 18 months, as an “existing business relationship” lasts for 18 months.

Disclosures to Donors

  • For 501(c)(3) tax-exempt organizations, contributors who gave a “quid pro quo” donation (received something in return) of more than $75 must receive certain disclosure information, and donors contributing more than $250 must receive additional disclosure information.  Further information can be found on the IRS’s web site on Substantiating Charitable Contributions.

*The information contained in this post is provided for informational purposes only, and should not be construed as legal advice on any subject matter.  You should not act or refrain from acting on the basis of any content included in this site without seeking legal or other professional advice. The contents of this post contain general information and may not reflect current legal developments or address your situation. We disclaim all liability for actions you take or fail to take based on any content on this site.

Whether you have a question about Fundraising Legal Issues, or you’d like to discuss our business plan writing services, feel free to contact us for a free consultation!
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About Tyler Jensen

I work with entrepreneurs who are looking to attract investment and get out of the "Garage". I am passionate about helping entrepreneurs start companies that matter. I helped launch over 100 Companies, Non-Profits and Social Enterprises. I consider myself a serial entrepreneur, startup coach & trusted advisor. * Launching New Companies (For Profit, Non-Profit and Social Enterprise) * Expert Business Plan Writer * Extensive Network of Business Relationships focused on Launch & Rapid Growth of New Companies * Startup, Growth, Marketing, Technology, Web, Business Systems * Trusted Advisor to CEO’s & Entrepreneurs * Capital Raising Strategy Development * Startup Team Development The first company I started and sold is VAVi Sport & Social Club which grew to over 25,000 members in six years, was recognized as San Diego’s 30th fastest growing private company in 2006 by the San Diego Business Journal and 32nd fastest in 2007, and sold for over 25X the capital investment.