Want to crowdfund tax-deductible donations for an awesome project in your community? Fiscal sponsorship helps you do that!

As a nonprofit crowdfunding platform for local positive change, ioby offers limited fiscal sponsorship nationwide to eligible projects crowdfunding on our platform. That sponsorship lets you accept tax-deductible donations even if you are an individual or working with an unincorporated group. There’s a bit of fine print, but for the most part you simply need to have a US-based project that meets the criteria for fundraising on ioby to be eligible for fiscal sponsorship. We rounded up everything you need to know about fiscal sponsorship at ioby below to help you plan your project and start gathering donations. 

Please note that ioby’s fiscal sponsorship is limited and constrained to your crowdfunding project. If you need an ongoing and comprehensive fiscal sponsor, you may be eligible to crowdfund with ioby but would need another organization to fiscally sponsor you. Check out these resources on finding a fiscal sponsor.

So, what is fiscal sponsorship?

Fiscal sponsorship is an arrangement in which a legally incorporated nonprofit agrees to accept and manage funds for another entity, such as an individual or informal group. It occurs when a group or individual wishes to receive tax-exempt contributions for charitable or community-focused activities without building a full organizational infrastructure. 

How does fiscal sponsorship work at ioby? Does it cost anything?

When you create your ioby campaign page, under “Group Tax info,” you’ll share whether or not you already have a fiscal sponsor. If you do, great! You’re good to go. If you don’t have a fiscal sponsor, check “no” and we’ll reach out to provide more information about our fiscal sponsorship and what you’ll need to do for us to be your fiscal sponsor.

At the conclusion of your crowdfunding campaign, we’ll email you a straightforward fiscal sponsorship contract. As your fiscal sponsor, ioby requires a certain level of documentation for all transactions. All project-related purchases must be substantiated by receipts or invoices. Once you’ve finished crowdfunding and are ready to receive your funds, we’ll send you a form where you’ll submit your receipts to ioby.

Like most fiscal sponsors, ioby retains a small percentage of what is raised to help cover our administrative costs of managing the funds. We’ve kept our fee to 8%--much lower than most--in an effort to best support your community-based work.

How will my donors know that their donation is tax-deductible?

ioby sends an automatic thank you email to every donor to an ioby campaign. This email includes text confirming that their donation is tax-deductible to the fullest extent of the law, and serves as your donors’ documentation of their charitable donation.

What if I got a grant and need a fiscal sponsor to receive it?

ioby supports crowdfunding campaigns by local leaders who are working to build a base of supporters and donors in their community. If you are NOT interested in running a crowdfunding campaign, we’re not the right fiscal sponsor for you. Check out our tips on finding a fiscal sponsor here.

However, if you receive a grant during the course of your ioby crowdfunding campaign, we can accept it on your behalf and apply it toward your total fundraising goal online. The amount disbursed to you at the end of your campaign would be the total of any grant funds plus all the online donations you’ve raised, and ioby’s fiscal sponsorship fee would apply to that total. Please note that in order for us to receive a grant on your behalf, the grant must not exceed 75% of your crowdfunding budget. You must crowdfund at least 25% of your budget.

What if I want to offer direct cash assistance?

Awesome! Direct aid—giving financial assistance directly to individuals—can be a powerful and relatively simple way of lending a hand in challenging times. ioby can offer support and fiscal sponsorship to direct cash assistance campaigns, there are just a few additional requirements. 

What if I already have a fiscal sponsor?

Great! You are welcome to crowdfund on ioby with a different nonprofit fiscal sponsor, you'll just need to provide us with a bit more information, like their federal nonprofit determination letter. Once you've finished crowdfunding, we'll pass the funds you raise to your fiscal sponsor and they will distribute the funds to you according to the agreement you have in place.

A bit of fine print.

ioby offers limited fiscal sponsorship, which means that our sponsorship only extends to your crowdfunding project. It is important to note that we don’t offer the kind of full fiscal sponsorship you might find at other organizations, like a community foundation. That means that once your campaign is over and your funds are disbursed, we are no longer able to serve as your fiscal sponsor (unless you crowdfund for another project, that is!). This also impacts your ability to receive grants with ioby as your fiscal sponsor (something we can do, but on a limited basis).

There are also just a few types of projects for which we aren’t able to offer fiscal sponsorship, but that are still eligible to crowdfund with ioby if you have another fiscal sponsor. That just means you'll need to find another organization to sponsor you while you crowdfund on ioby. We'll let you know if that's the case once you've submitted your project idea, but you can also drop us a line at hello@ioby.org if you have questions about whether your project is eligible for fiscal sponsorship.

Questions?

Learn more about fiscal sponsorship, and how to choose the right one, here.   

If you'd like to speak to someone about ioby's fiscal sponsorship service and see whether your idea might be a fit for ioby's platform, reach out to us any time at hello@ioby.org, or give us a call at (917) 464-4515.