Basics of Fiscal Sponsorship

1. What is fiscal sponsorship?
Fiscal sponsorship is a formal relationship where a 501(c)(3) public charity, like Community Shares of Mid Ohio through In(form)ed, agrees to sponsor a community project that does not have its own tax-exempt status. This allows the project to operate under our tax-exempt umbrella so it can receive grants, tax-deductible donations, and other contributions.

2. How is fiscal sponsorship different from starting my own nonprofit?
Starting a nonprofit requires forming a new organization, registering with the state and the IRS, waiting months for approvals, and paying multiple filing fees. Fiscal sponsorship lets you begin fundraising and offering programs much sooner by working under our existing 501(c)(3) status, while we handle key legal, financial, and administrative responsibilities.

3. Who is eligible for fiscal sponsorship through In(form)ed and Community Shares of Mid Ohio?
Fiscal sponsorship is available to community-driven projects whose work aligns with Community Shares of Mid Ohio’s issue areas. Model A is reserved for projects focused on fundraising programs that support other nonprofits. Model C is open to a broader range of community projects that fit Community Shares’ mission and values.

4. Why would a community project choose fiscal sponsorship instead of forming a 501(c)(3) right away?
Fiscal sponsorship reduces startup time and cost, and lets you focus on your mission rather than paperwork. It is especially helpful if you want to:

• Test a new idea or proof of concept

• Start programs while registrations are still pending

• Avoid or delay the costs and complexity of forming a standalone nonprofit

5. Is fiscal sponsorship a temporary arrangement, or can it be long-term?
It can be either. Model C is typically tied to a specific grant and ends when the grant is complete. Model A is an ongoing relationship with annual renewal and can support your project over a longer period, as long as it continues to align with Community Shares’ mission and policies.

Legal and Financial Structure

6. What does it mean to operate under Community Shares’ 501(c)(3) status?
Your project does not become its own legal nonprofit. Instead, it operates as a project or program under Community Shares’ tax-exempt umbrella. Community Shares is ultimately responsible for ensuring that funds are used for charitable purposes and that all legal and financial requirements are met.

7. What kinds of contributions can fiscally sponsored projects receive?
Depending on the model, fiscally sponsored projects can receive:

• Grants from foundations and other funders

• Tax-deductible donations from individuals

• Corporate contributions and sponsorships

• Other charitable gifts processed through Community Shares

8. Who is legally responsible for funds received under fiscal sponsorship?
Community Shares of Mid Ohio is the legal recipient and steward of all funds under fiscal sponsorship. We ensure funds are managed, disbursed, and reported in accordance with nonprofit law, our internal policies, and any grant or donor requirements.

9. How are funds held, tracked, and reported for my project?
Funds for your project are held in a dedicated account within Community Shares’ accounting system. We track income and expenses specific to your project and provide regular financial reporting so you can monitor your budget and make informed decisions.

10. Does my project need its own bank account or EIN?
In most cases, no. Under fiscal sponsorship, contributions are received and managed through Community Shares. Your project may or may not choose to obtain its own EIN for other purposes, but all sponsored funds must flow through Community Shares’ financial systems.

Costs and Fees

11. What is the administrative fee, and what does it cover?
In(form)ed charges a 10% administrative fee on all revenue to your project for both Model A and Model C. This fee supports the legal, financial, and administrative infrastructure that makes fiscal sponsorship possible, including accounting, compliance, reporting, and staff time.

12. Are there any additional costs beyond the 10% administrative fee?
There may be project-specific costs, such as insurance premiums, specialized legal services, or payment processing fees, depending on your activities and chosen model. These are discussed during the application and agreement process so there are no surprises.

13. How and when is the administrative fee deducted?
The 10% fee is typically deducted from each contribution or revenue source as it is received. Details are outlined in your fiscal sponsorship agreement.

Model A vs. Model C

14. What is the difference between Model A and Model C fiscal sponsorship?

• Model C is project-specific and usually tied to a single grant. Your project maintains its own legal compliance (such as registrations and insurance), while In(form)ed receives and manages the grant funds and provides financial reporting.

• Model A is more comprehensive. Your project functions like a department or program of Community Shares through In(form)ed. We provide broader administrative support, including insurance, accounts payable and receivable, donations, grants, and compliance.

15. How do I know whether Model A or Model C is right for my project?
Model C may be a good fit if you:

• Have a specific grant opportunity

• Can manage your own legal registrations and insurance

• Need a fiscal sponsor mainly to receive and manage a grant

Model A may be a better fit if you:

• Envision ongoing programming and fundraising

• Want deeper administrative support

• Focus on fundraising programs that support other nonprofits

Our team can help you decide which model is appropriate during an initial conversation or by using our Fiscal Sponsorship Quiz.

16. Can I switch between Model C and Model A later?
In some cases, projects may transition between models as they grow or as their needs change. Any change would require review and approval by In(form)ed and Community Shares, and a new or amended agreement.

17. Under Model C, who is responsible for legal compliance?
Model C projects are responsible for their own legal compliance, such as business registrations, insurance, and any other required filings. In(form)ed’s role is to ensure that grant funds are managed correctly and that financial reporting to the funder is accurate.

18. What additional support does In(form)ed provide under Model A?
Under Model A, In(form)ed provides more comprehensive support, which may include:

• Insurance coverage (as outlined in your agreement)

• Accounts payable and receivable

• Donation and grant processing

• Financial tracking and reporting

• Oversight of compliance with nonprofit and grant requirements

19. What kinds of fundraising are allowed under each model?

• Model C is focused on the specific sponsored grant, though other activities may be considered on a case-by-case basis.
• Model A allows a broader range of fundraising, such as grants, individual giving, corporate giving, sponsorships, and more, as long as they align with Community Shares’ mission and policies.

20. How long does Model C fiscal sponsorship last?
Model C sponsorship typically lasts for the duration of the sponsored grant. Once the grant period ends and all reporting and obligations are fulfilled, the fiscal sponsorship relationship for that grant concludes.

21. Is Model A an ongoing relationship, and how is it renewed?
Yes. Model A sponsorship is generally an ongoing relationship with an annual review. The agreement is renewed each year based on alignment with Community Shares’ mission, performance, and mutual interest in continuing the partnership.

Eligibility and Alignment

22. What types of projects are eligible for Model C sponsorship?
Model C is available to community projects that align with any of Community Shares of Mid Ohio’s issue areas. If your work advances social, economic, or environmental equity in our region, there is a good chance it may be a fit.

23. What does it mean to align with Community Shares’ issue areas?
Alignment means your project’s mission, values, and activities support the same broad goals as Community Shares and its member organizations—for example, advancing justice, equity, and opportunity in our community. We look for clear alignment during the application and review process.

24. Which kinds of projects are considered for Model A sponsorship?
Model A is designed for community projects that primarily focus on fundraising programs to support other nonprofit organizations. Projects with activities beyond fundraising may be considered at the discretion of Community Shares before applying.

25. Are there activities or program types that are not eligible?
Yes. Projects that do not align with Community Shares’ mission, that pose undue legal or financial risk, or that fall outside our charitable purposes may not be eligible. We review each application individually to ensure a good fit.

26. Do I need a board or advisory group to be considered?
While you are not required to be a standalone nonprofit with a formal board, we do look for some structure and leadership for your project—such as a core team or advisory group—that can help guide the work and meet reporting obligations.

Program, Impact, and Support

27. Who is responsible for program design and implementation?
Your project team is responsible for designing and running the program. In(form)ed provides the legal, financial, and administrative framework so you can focus on delivering impact in the community.

28. Who completes impact or outcomes reporting for grants under Model C?
Your project is responsible for program impact and outcomes reporting to the funder. In(form)ed supports you by handling the financial reporting and ensuring that grant funds are used in line with the grant agreement.

29. Does In(form)ed help with program evaluation, or only financial reporting?
Our primary role is financial stewardship, compliance, and administrative support. While we may provide guidance and share best practices, program evaluation and impact measurement remain the responsibility of your project.

30. Can fiscally sponsored projects hire staff or pay contractors?
Yes, in many cases. Under Model A, staff and contractors are generally engaged through Community Shares’ systems. Under Model C, the structure may vary. Details are discussed during the application and agreement process to ensure compliance with employment and tax laws.

Compliance and Risk

31. What ongoing reporting or documentation is required from my project?
Projects are expected to:

• Submit regular updates on activities and outcomes

• Provide information needed for financial reporting

• Follow Community Shares’ policies and grant requirements

Exact expectations are outlined in your fiscal sponsorship agreement.

32. What insurance coverage is provided under Model A, and what must my project maintain?
Under Model A, certain insurance coverage may be provided through Community Shares, depending on your activities. Some projects may still need additional coverage. We will review your specific needs during the intake and agreement process.

33. What happens if my project doesn’t comply with grant terms or sponsor policies?
Non-compliance can put both your project and Community Shares at risk. We work with you to resolve issues when they arise, but in serious cases, we may need to suspend activities, return funds, or terminate the fiscal sponsorship agreement.

34. How are risks and conflicts of interest managed?
Community Shares maintains policies and procedures to identify and manage risk, including conflicts of interest. We expect project leaders to disclose potential conflicts and to follow our policies to protect the integrity of the work.

Timeline and Process

35. How long does it usually take to get approved for fiscal sponsorship?
Timelines can vary, but the process generally takes several weeks from the time you submit your completed application. This allows time for staff review, committee consideration, and a vote by the Community Shares Board of Trustees.

36. What is the application and approval process?
The typical process is:

1. Connect with In(form)ed staff to discuss your project and needs.

2. Complete our online application form.

3. Staff and a committee review your application.

4. The committee sends its recommendation to the Community Shares Board of Trustees.

5. The Board votes on your application.

6. If accepted, we will develop and sign a fiscal sponsorship agreement together.

37. Who reviews my application, and what are they looking for?
Your application is reviewed by In(form)ed staff, a committee, and ultimately the Community Shares Board of Trustees. They look for mission alignment, feasibility, clear leadership, a realistic plan, and responsible use of charitable funds.

38. When can my project start fundraising or applying for grants?
You can begin fundraising or applying for grants under fiscal sponsorship once your project has been formally accepted and your agreement is signed. At that point, your project can begin receiving funds through Community Shares.

39. What happens after my project is accepted?
After acceptance, we finalize and sign the sponsorship agreement, set up your project in our financial systems, and walk you through processes for receiving funds and paying expenses. We also review communication channels and expectations so you start off with clarity and support.

Relationship and Exit

40. What does the day-to-day relationship with In(form)ed look like?
You lead the program work, and we partner with you on the back end. You’ll work with In(form)ed staff on budgeting, financial transactions, and reporting, and you’ll stay in regular communication so we can support your project effectively.

41. Can my project eventually become its own independent nonprofit?
Yes. Many projects use fiscal sponsorship as a pathway to becoming an independent nonprofit. If you decide to pursue your own 501(c)(3) status, we will work with you on a transition plan for your funds and responsibilities.

42. What happens to the remaining funds if my project ends or leaves fiscal sponsorship?
Any remaining funds must continue to be used for charitable purposes consistent with Community Shares’ mission and IRS rules. The specific plan for remaining funds will be addressed in your agreement and in any exit or transition plan.

43. How do we end or not renew a fiscal sponsorship agreement?
Either party can decide not to renew or to end the relationship, following the terms outlined in the agreement. We will work with you on a thoughtful transition that respects donors’ intentions and legal requirements.

Practical and Fundraising Support

44. What administrative services does In(form)ed provide?
Depending on the model, services may include:

• Accounting and bookkeeping

• Accounts payable and receivable

• Donation and grant processing

• Financial reporting

• Oversight of legal and grant compliance

45. Does In(form)ed help with grant writing or fundraising strategy?
Our core role is fiscal and administrative sponsorship. While we may offer guidance, connections, or feedback, your project is primarily responsible for developing fundraising strategies and preparing grant proposals.

46. How do donors make tax-deductible gifts to my project?
Donors give to Community Shares of Mid Ohio and designate your project. Because Community Shares is a 501(c)(3) public charity, eligible gifts are tax-deductible, and we ensure they are directed to your project’s account.

47. Will my project appear on Community Shares’ or In(form)ed’s materials?
Many fiscally sponsored projects are featured on our website or in our communications, especially as partnerships grow. Specific visibility and communication plans are discussed as part of the sponsorship relationship.