Creating a Fiscal Sponsorship Fund
An Fiscal Sponsorship Fund is a fund that a charitable group or nonprofit organization creates at the Community Foundation to obtain fiscal sponsorship of its programs and activities and to work toward long-term support and stability.
Steps to Starting an Fiscal Sponsorship Fund
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- Organization/project leaders review "Fiscal Sponsorship Fund Policies and Procedures"
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- Organization leaders contact the Community Foundation staff to discuss the fund
- group must be an existing 501 (c)(3) nonprofit organization
OR
- group without a 501 (c) 3 must have a mission statement, board structure, ability to incorporate with the State of Illinois as a charitable corporation, and agree to obtain liability insurance for any activities involving the public
- Organization leaders contact the Community Foundation staff to discuss the fund
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- Organization leadership approves opening a fund at the Community Foundation
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- Organization and Community Foundation complete and sign a Fund Agreement; organization presents a check to open the fund
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- Community Foundation board approves the new fund
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- Organization may begin using the fund
Important Considerations
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- IRS regulations require IPCF to own the assets in the funds it administers. Therefore, establishing a fund requires the organization to transfer title to the assets irrevocably to IPCF
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- The organization may choose either an equity or cash option for its Community Foundation fund
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- IPCF charges a fee for each component fund to cover the costs of the Community Foundation's services. The amount of the fee is subject to change
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- IPCF may charge additional fees for event management, grant management, or other fund administration duties requiring additional staff time and services
Benefits of a Fiscal Sponsorship Fund
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- Quality cost-effective administration and stewardship services
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- Ability to accept gifts of stock, real estate and other assets
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- Credibility
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- Education concerning nonprofit best practices and procedures
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- Charitable networking opportunities
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- Professional investment management
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- Agency fund is included in IPCF's Form 990 tax return and annual audit