What does it mean for organizations to actually get "fiscal"? Well, fiscal sponsorship is a model where nonprofit organizations extend their legal and tax-exempt status to groups conducting activities aligned with the sponsor's mission.
This approach offers projects a way to leverage established resources and expertise, enabling the nonprofits to focus on their mission without the complexities of setting up an independent nonprofit entity. Talk about a time-saver!
Selecting the most suitable fiscal sponsor is crucial for a project’s success. According to Braden Fineberg, the CEO of Ribbon, which is a single-purpose platform actually BUILT for fiscal sponsors, making their lives easier, these are five key aspects to consider when choosing the right fiscal sponsor partner:
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Reputation and track record: Choose a sponsor known for successfully managing projects similar to yours, ensuring reliability and effectiveness.
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Financial health and transparency: Select a sponsor demonstrating solid financial stability and clear financial management and reporting.
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Level of operational control: Be aware of the degree of control you as the nonprofit will have over essential decisions, including the timing of donation availability and other operational aspects.
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Fee structure and range of services: Understand the potential sponsor's fee structure to ensure your org is only paying for what it needs, and evaluate the range of services they offer, from core administrative support to grant writing, to meet your organization's project needs.
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Mission and values alignment: Choose a sponsor whose mission and values resonate closely with the organization's objectives.
Read more about Braden and Ribbon below:
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