A charitable solicitation is any attempt to raise funds from an individual, group, or public. Nonprofits use solicitations to raise funds supporting missions. Solicitations build donor relationships through meetings, events, mail, calls, emails, websites. Many states require registration before nonprofits solicit residents. Some states require it for online donations. Failure to register risks state fines, IRS scrutiny, donor suspicion.
Legal Compliance
Charitable solicitation laws provide transparency and protect the public from misrepresentation. Registration involves disclosing finances and activities. If a state’s residents can donate online, nonprofits likely need to register there. States define solicitation to include oral, written, and online donation requests. Physical presence isn’t required for registrable solicitation.
Fundraising and Registration
Fundraising events are solicitations. Capital fundraising raises major sums for buildings, endowments, separate from operating funds. A 15 percent fundraising expense ratio is often cited as average. As nonprofits reinvest income into programs, they are income tax exempt. Registration applies to online fundraising. States define solicitation to include oral, written, and online donation requests. Physical presence isn’t required for registrable solicitation.