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

 

    • Organization/project leaders review "Fiscal Sponsorship Fund Policies and Procedures"

 

    • 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 leadership approves opening a fund at the Community Foundation

 

    • Organization and Community Foundation complete and sign a Fund Agreement; organization presents a check to open the fund

 

    • Community Foundation board approves the new fund

 

    • Organization may begin using the fund

 

 

Important Considerations

 

    • 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

 

    • The organization may choose either an equity or cash option for its Community Foundation fund

 

    • 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

 

    • 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

 

    • Quality cost-effective administration and stewardship services

 

    • Ability to accept gifts of stock, real estate and other assets

 

    • Credibility

 

    • Education concerning nonprofit best practices and procedures

 

    • Charitable networking opportunities

 

    • Professional investment management

 

    • Agency fund is included in IPCF's Form 990 tax return and annual audit