Checklist · Nonprofit

Registering to Fundraise and Running a Compliant Campaign: A Practical Checklist

26 U.S.C. § 501

Type
Checklist
Jurisdiction
National
Date
2024-06-28
Topic
Nonprofit

A step-by-step checklist for registering to fundraise and running a campaign that survives review. Section A covers the registration decision, including the trigger that catches organizations by surprise and the exemptions that do not travel between states. Section B covers what is filed and what must be redacted. Section C covers hiring a professional fundraiser, the contract terms that matter, and the custody rule that prevents most losses. Section D covers commercial co-ventures and the two disclosures that prevent most enforcement. Section E covers donor acknowledgments, quid pro quo statements, and restricted gifts. Section F covers channel compliance. Section G covers crowdfunding, disaster appeals, and the donor's own checklist.

Registering to Fundraise and Running a Compliant Campaign: A Practical Checklist

Nonprofit > Charitable Solicitation and Fundraising | Published 28 June 2024 - Updated 12 March 2026 | UpLaw - uplaw.us

Start here

Two rules govern everything below:

  1. You may spend what you spend. No state may regulate your fundraising ratio or compel you to disclose it at the moment of the ask.
  2. You may not lie about it. A false or misleading statement about the use of funds is the whole risk.

And one operational fact: a donation page solicits in every state a person can reach it from.

SECTION A — DO YOU HAVE TO REGISTER?

A1. Identify where you solicit

☐ Where is your donation page reachable? (Everywhere.) ☐ Where do you send mail appeals? ☐ Where do you send email appeals? ☐ Where are your social media asks seen? ☐ Where do you hold events, and where do attendees come from? ☐ Where are your grant applications sent? ☐ Where does a paid solicitor call on your behalf?

⚠️ The "passive website" argument has not worked for a long time. Do not build a compliance position on it.

A2. Check exemptions — state by state

☐ Religious organization — see Religious Organizations ☐ Educational institution ☐ Hospital or health care institution ☐ Membership organization soliciting only members ☐ Small organization below a revenue floor ☐ Solicitation limited to one county or municipality

☐ An exemption in one state does not travel. ☐ Several states require an exemption filing rather than exempting automatically. Check. ☐ Confirm the exemption still applies as revenue grows

A3. Decide the scope

☐ Register everywhere you actually receive gifts (safest) ☐ Use the unified registration form where accepted, plus state supplements ☐ Or register in the home state and the states where donors actually are, accept the residual risk, and expand as giving grows — the practical choice for most small organizations ☐ Register before you solicit, not after

SECTION B — WHAT YOU FILE

☐ Articles of incorporation and bylaws ☐ Federal exemption determination letter — status under 26 U.S.C. § 501 ☐ Officer, director, and key employee list ☐ Financial statements; audited above the state's revenue threshold ☐ The annual informational return required by 26 U.S.C. § 6033 ☐ ⚠️ Redact the donor schedule. Blanket state collection of major-donor identities is unconstitutional — Americans for Prosperity Foundation v. Bonta, 141 S. Ct. 2373. File redacted even where a state's form has not been updated, and challenge a rejection rather than complying. ☐ Contracts with professional fundraisers, where required ☐ Fees

Then: ☐ Calendar renewals with a named owner and a backup ☐ Calendar the audit threshold, because growing across it mid-year is discovered at renewal ☐ Note that enforcement is by state attorneys general, with subpoena power and standing to sue for breach of charitable trust — see Administrative Law

SECTION C — HIRING A PROFESSIONAL FUNDRAISER

C1. Determine the category, in every state

☐ Paid solicitor — solicits for compensation. Register, bond, file the contract before soliciting, file campaign reports, and identify as a paid solicitor at the point of solicitation ☐ Fundraising counsel — plans, manages, advises; does not solicit; does not hold funds ☐ Commercial co-venturer — see Section D

⚠️ The counsel/solicitor line is contested for consultants who draft the appeal and manage responses. Assume the broader category when unclear.

C2. Verify before signing

☐ Registration current in every state of the campaign ☐ Bond in force ☐ Disciplinary and enforcement history ☐ References from other charities

C3. Contract terms that matter

☐ Contributions payable to the charity, deposited in the charity's account — adopt this even where not required; it eliminates the largest category of loss in the field ☐ Scope: campaigns, channels, states ☐ Compensation, stated clearly ☐ Script and materials approved by the charity in writing before use, with no changes without approval ☐ Accuracy covenant — no statement about the use of funds that is untrue or creates a false impression. This is the Illinois ex rel. Madigan v. Telemarketing Associates, 538 U.S. 600 standard, and it is the whole risk ☐ Registration and bonding representations, with a maintenance covenant ☐ Point-of-solicitation identification of the solicitor and the charity ☐ Channel compliance — 16 C.F.R. Part 310, 47 U.S.C. § 227, 15 U.S.C. § 7704 — with suppression list transfer ☐ Donor data belongs to the charity; no use, retention, sale, or rental by the solicitor ☐ Campaign reporting on a schedule that lets the charity file its own reports ☐ Audit rights ☐ Immediate termination for misrepresentation, without cure ☐ Indemnity for regulatory penalties arising from the solicitor's conduct

C4. During the campaign

☐ Review the script. Your exposure depends on what you knew and approved. ☐ Reconcile remittances monthly ☐ Spot-check calls where lawful ☐ File the campaign financial report on time

SECTION D — COMMERCIAL CO-VENTURES

☐ Written contract with the business, before the campaign ☐ File it where the state requires ☐ Confirm co-venturer registration and bonding where required ☐ State the amount per item precisely — never "a portion" or "proceeds" ☐ Disclose any cap at the point of sale, along with the duration ☐ Approve all advertising in writing before use ☐ Trademark license, limited in scope, time, and manner, terminable on breach ☐ Require an accounting after the campaign, with supporting records ☐ Require payment within a stated period ☐ Reserve termination and correction rights if a disclosure proves inaccurate ☐ Indemnity to the charity

⚠️ The two failures that generate nearly all enforcement: the undisclosed cap, and the undefined percentage. Both are deceptive under 15 U.S.C. § 45 and state analogues — see Everything We Say Is True and Substantiating Advertising Claims.

📌 The exposure is asymmetric. The company runs the campaign for a month; the charity answers for it for years.

SECTION E — DONOR DOCUMENTS

E1. Acknowledgments — every gift

☐ Amount and date ☐ Whether goods or services were provided ☐ Where they were, a description and good faith estimate of their value ☐ Statement that no goods or services were provided, where that is true ☐ Provided contemporaneously — the donor's deduction under 26 U.S.C. § 170 fails without it, and only the charity can supply it

E2. Quid pro quo statements — every event

☐ Required where a payment above the threshold is partly a gift and partly for goods or services — 26 U.S.C. § 6115 ☐ Must state that the deductible amount is limited to the excess over the value received ☐ Must include a good faith estimate of that value ☐ Applies to: gala tickets · auctions · raffles · benefit concerts · golf tournaments · premiums and thank-you gifts above the de minimis threshold ☐ Fix the template, not the individual receipt. This failure is never isolated.

E3. Nondeductibility statements

☐ Required in every solicitation by an exempt organization not eligible for deductible contributions — 26 U.S.C. § 6113 ☐ Conspicuous, and in a form reasonably likely to come to the recipient's attention

E4. Restricted gifts

☐ A gift solicited for a stated purpose is restricted to that purpose, enforceable as a charitable trust ☐ Add the variance sentence to every restricted appeal: "If [purpose] is fully funded or becomes impracticable, [charity] will apply contributions to other programs consistent with its charitable mission." One sentence, costless, omitted constantly. ☐ Without it, redirecting requires donor consent, or relief from a court or the attorney general ☐ Track restricted balances and confirm annually that they are being used as stated ☐ Related insider exposure: 26 U.S.C. § 4958

SECTION F — CHANNEL COMPLIANCE

⚠️ Charitable status is not a channel exemption. This is the most expensive assumption in the field.

F1. Telephone

☐ A telefunder calling on your behalf is covered by 15 U.S.C. § 6101, 15 U.S.C. § 6102, and 16 C.F.R. Part 310 even where you are not ☐ Prompt identification of the caller and the charity ☐ No misrepresenting the purpose or the recipient ☐ Calling hour restrictions ☐ Entity-specific do-not-call requests honored, with a maintained suppression list

F2. Automated calls and texts

☐ 47 U.S.C. § 227 requires consent for autodialed or prerecorded calls and texts to mobile numbers ☐ Statutory damages per message — the most litigated fundraising channel by a wide margin ☐ Maintain consent records capable of surviving a claim ☐ Honor revocation immediately, across all channels

F3. Email

☐ 15 U.S.C. § 7704: accurate headers, non-deceptive subject lines, a working opt-out honored promptly, and a valid postal address

F4. Mail

☐ No appeals that resemble invoices ☐ Unsolicited premiums create no obligation to pay, and implying otherwise is deceptive under 15 U.S.C. § 45 and state analogues ☐ Sweepstakes-adjacent appeals carry their own state rules

F5. Donor data

☐ Donor lists are personal data; state privacy statutes increasingly reach nonprofits ☐ Rented and exchanged lists are the specific exposure ☐ Publish a privacy notice covering donor data; honor access and deletion requests where applicable ☐ Contract with platforms, processors, and telefunders on data terms — see Data Privacy and Security

SECTION G — CROWDFUNDING, DISASTERS, AND DONORS

G1. Fundraising on a platform

☐ Every ordinary obligation applies — registration, acknowledgment under 26 U.S.C. § 170, and the co-venture rules if a business is involved ☐ Confirm the platform has your written consent to list you; several states now require it ☐ Confirm how and when funds are transmitted, and what fees are deducted ☐ Confirm who issues the acknowledgment — you or the platform — and that it satisfies the statute ☐ Confirm the platform's escrow and refund practices

G2. Individual crowdfunding — what to tell someone

☐ An appeal for an individual is generally not a charitable solicitation, and is largely unregulated ☐ Ordinary fraud law still applies, including 18 U.S.C. § 1341 and 18 U.S.C. § 1343 ☐ Donations are not deductible to the donor ☐ Funds may be income to the recipient depending on the facts ☐ ⚠️ A lump sum can destroy means-tested benefits worth more than the campaign raised. Raise this before the campaign, not after. ☐ Plan for surplus in advance, and say in the appeal what will happen to it

G3. Disaster appeals

☐ Confirm registration before launching; several states have emergency registration provisions ☐ Include the variance language — oversubscription is the norm, not the exception ☐ Describe the use of funds in terms you can substantiate a year later ☐ Coordinate with responders already operating rather than duplicating ☐ Expect fraudulent competitors: sound-alike names, unregistered social media appeals, and door-to-door collection

G4. The donor's checklist

☐ Look up registration — public, free, one minute ☐ Read the annual return: program versus fundraising versus administration, executive compensation, related-party transactions ☐ Ask a solicitor directly: "Are you a paid solicitor, and who employs you?" They must answer ☐ Never give a card number to an inbound caller. Hang up and give directly ☐ Read co-venture fine print for the cap ☐ Get the acknowledgment if you intend to deduct ☐ Be skeptical of urgency, sound-alike names, and post-disaster appeals from entities with no history — see Responding to Fraud, a Scam, or Financial Exploitation ☐ Do not ask for the percentage. Ask what the organization accomplished last year — the ratio measures age and popularity more than integrity, which is why Village of Schaumburg v. Citizens for a Better Environment, 444 U.S. 620 and Riley v. National Federation of the Blind of North Carolina, 487 U.S. 781 took it off the table

SECTION H — THE ANNUAL AUDIT

☐ 1. Registration current in every state where you solicit ☐ 2. Exemption filings current where required ☐ 3. Donor schedule redacted on all state filings ☐ 4. Audit threshold checked against current revenue ☐ 5. Acknowledgment and quid pro quo templates reviewed and in use at every event ☐ 6. Nondeductibility statement in every solicitation, if applicable ☐ 7. Variance language in every restricted appeal ☐ 8. Restricted balances reviewed against stated purposes ☐ 9. Fundraiser and co-venturer contracts board-approved and filed ☐ 10. Scripts and point-of-sale language reviewed and approved in writing ☐ 11. Channel consent and suppression records verified ☐ 12. Donor data practices and vendor contracts reviewed

SECTION I — MODEL LANGUAGE

I1. Acknowledgment, no goods or services

[Charity], [address], [EIN]

Thank you for your contribution of $[amount], received on [date].

No goods or services were provided in exchange for this contribution.

[Charity] is recognized as exempt under 26 U.S.C. § 501. Please retain this acknowledgment for your records; it is required to substantiate a charitable deduction under 26 U.S.C. § 170.

I2. Quid pro quo statement

Thank you for your payment of $[total] on [date] for [event/item].

In exchange, you received [description], with a good faith estimate of fair market value of $[value].

The amount deductible as a charitable contribution is limited to the excess of your payment over the value of what you received: $[total − value].

(Required by 26 U.S.C. § 6115. Substantiation rules: 26 U.S.C. § 170.)

I3. Nondeductibility statement

Contributions or gifts to [organization] are not deductible as charitable contributions for federal income tax purposes.

(Required conspicuously in every solicitation by an exempt organization not eligible to receive deductible contributions — 26 U.S.C. § 6113.)

I4. Variance language for a restricted appeal

"Contributions to this appeal will be used for [purpose]. If [purpose] is fully funded or becomes impracticable, [charity] will apply contributions to other programs consistent with its charitable mission."

📌 One sentence. Add it to every restricted appeal. Without it, a surplus is legally frozen.

I5. Point-of-sale co-venture disclosure

"For each [product] purchased between [start date] and [end date], [company] will donate $[amount] to [charity], up to a maximum total donation of $[cap]."

⚠️ Never "a portion," "proceeds," or "a percentage of sales" without the number, the dates, and the cap.

I6. Solicitor identification script

"Hello, my name is [name]. I am a paid solicitor calling on behalf of [charity name]."

Required at the point of solicitation in most states. What may not be compelled is disclosure of the percentage turned over to the charity — Riley v. National Federation of the Blind of North Carolina, 487 U.S. 781.

SECTION J — THE TEN-LINE VERSION

☐ 1. A donation page solicits everywhere. Register before you ask. ☐ 2. Exemptions do not travel, and several states require an exemption filing. ☐ 3. Redact the donor schedule on state filings — Americans for Prosperity Foundation v. Bonta, 141 S. Ct. 2373. ☐ 4. Calendar renewals, with an owner and a backup. ☐ 5. Require contributions payable to the charity. Never let a solicitor hold funds. ☐ 6. Review the script. Your exposure under Illinois ex rel. Madigan v. Telemarketing Associates, 538 U.S. 600 depends on what you approved. ☐ 7. In a co-venture, state the amount per item and disclose the cap at the point of sale. ☐ 8. Fix the acknowledgment and quid pro quo templates — the failure is never isolated. ☐ 9. Add the variance sentence to every restricted appeal. ☐ 10. Treat channel rules as applicable to you; charitable status is not an exemption.

SECTION K — FOR THE BOARD

Fundraising is a governance function, not an administrative one, and boards that treat it otherwise discover the problem during an enforcement inquiry.

☐ Approve fundraiser and co-venturer contracts at the board level, not staff level ☐ Review registration status annually as a standing agenda item, with the state list and renewal dates ☐ Review restricted-gift balances and confirm they are being used for their stated purposes ☐ Ask what the organization says about the use of funds, and whether every statement can be substantiated ☐ Review the acknowledgment and quid pro quo templates once — most boards have never seen them, and most are wrong ☐ Understand insider-transaction exposure under 26 U.S.C. § 4958; fundraising abuse and self-dealing travel together ☐ Confirm the annual return under 26 U.S.C. § 6033 was reviewed before filing, and that the donor schedule is redacted on state copies ☐ Confirm who owns the donor list under every vendor contract ☐ See Nonprofit Formation and Governance and Forming and Operating a Nonprofit

SECTION L — WHEN SOMETHING HAS ALREADY GONE WRONG

☐ Unregistered solicitation discovered. Register immediately, disclose the lapse if the form asks, and expect a late fee rather than a catastrophe. Do not continue soliciting in the state while curing. ☐ A solicitor misrepresented the use of funds. Terminate under the accuracy covenant, notify the states where the campaign ran, correct the record with donors who were misled, and preserve the script, the contract, and the approvals. Your exposure turns on what you knew. ☐ A co-venture claim was inaccurate. Correct it at the point of sale immediately, notify the charity or the company, quantify the shortfall, and pay it. A voluntary correction is treated very differently from one that follows a subpoena. ☐ Acknowledgments were wrong. Issue corrected acknowledgments for the affected period and fix the template. Donors who lose deductions because of your paperwork will remember it. ☐ A restricted appeal is oversubscribed. Do not redirect. Seek donor consent, invoke a reserved variance power, or apply to the court or attorney general. ☐ A state demanded the unredacted donor schedule. Cite Americans for Prosperity Foundation v. Bonta, 141 S. Ct. 2373 and challenge rather than comply. ☐ An attorney general opened an inquiry. Respond promptly, in writing, through counsel; preserve everything; and remember that the office holds subpoena power and standing to sue for breach of charitable trust — see Administrative Law.

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