Mar 04, 2011

Nonprofits Feeling Burden of New Fundraising-Registration Requirements

We'll probably be hearing more stories like the one with which Kiplinger's Personal Finance Magazine ended its March, 2011 issue: Herb Knoll, who founded a fledgling nonprofit called Michelle's Angels, describes the frustrations of needing to register the nonprofit in every state in which it receives donations and pay both first-time and annual renewal fees, and worries about the impact, in terms of costs and required time, on his group.

Although the article didn't specify, it looks quite logical for Michelle's Angels to want to be able to fundraise nationally. Unlike many nonprofits, it doesn't provide local services -- it primarily uses the Internet to providing emotional support to people in need due to illness or other reasons.

usa50one.gifSo as long as Michelle's Angels is reaching out to clients around the country, it would make perfect sense for it to ask them to contribute, or to request that their interested friends and family do so. Yet the site currently has to warn donors that it can accept contributions only from two U.S. states, New York and Tennessee, while it works on getting registered in others.

Knoll says, "There should be a not-for-profit national registry or a single, uniform state application and low fees -- or no fees for small charities."

Good idea -- let's hope that message gets to the right ears! In the meantime, for nonprofits struggling with interpreting and meeting the registration requirements, help can be found in the Nolo book, Nonprofit Fundraising Registration: The 50-State Guide, by Stephen Fishman.