No-frills, no-hassle third-party fundraising

January 16, 2015 3:41 PM

Let's say I really care about some charity. I'd like to do an online fundraising drive---with premiums that I send to donors. I'm not affiliated with the charity, or I am but this drive is an independent, personal initiative. Either way, the charity isn't involved except for the happy day when they get a check. Is there some online service that makes all this easy for me?

Ideally, here's how this would work:

I put up a fundraising website with some donate buttons. User clicks "Donate $25" or "Donate $50" or whatever. They go to a website that collects the money and sends it on to some charity (inevitable processing fees yada yada etc.). If the user wants, the website also sends me an email, viz.:

Dear Tss,

Online J. Donorson has just donated $50 to That Charity You Love. Please ship your handmade premium to this address:

OJ Donorson
Stately Donorson Manor
123 Main Street
Anytown, USA 15206

after which I send the premium off in the mail. The charity gets the cash, and presumably also the donor's address (if donor elects) so that they can send a thank-you letter.

Kickstarter seems kinda appropriate, but I'm not fundraising toward a specific goal, am not sure it would be accepted as a KS project anyway, and really don't want to spend 30 hours or whatever making an earnest 3min fundraising video. All I need is: hey, you want this thing? Well, click button, give my favorite charity $25 and I'll mail it to you.

Nice-to-have feature:

Suppose I didn't want to pay out-of-pocket for shipping. The website now collects $25.49 or $50.49, sends me the 49 cents for the stamp, and does the same thing with the rest that it did before. Is that possible?


Early tax season bonus question
(USA specific)

If the charity is a 501(c)(3) then the user would presumably be able to deduct the donation on their taxes.

When you receive a premium for donating to, say, your public radio station, usually only your donation less the value of that premium is deductible.

So what happens if you donate to some charity through some wacky third-party website and that website operator sends you a premium instead of the charity itself?

posted by tss to Computers & Internet (9 answers total)

I don't know what the laws around doing this are, but they're problematic for good reasons. Years ago, we held a fundraiser at MetaFilter to give money away to a small list of charities, and PayPal ended up freezing our account and threatened us with suspension. I had to obtain a document from each non-profit we gave money to that they were ok with me acting on their behalf to accept donations. That appeased paypal, and I took screenshots of the money that came in and went out to make it clear 100% of it was used for donations.

It made sense to me, because you could claim you were collecting for a non-profit and easily keep it for yourself. WIthout robust accounting, there's no way of knowing people are being truthful about this stuff so there is plenty of fraud that places like PayPal and non-profits are trying to combat. I would not proceed without a formal agreement in place with the non-profits you're trying to raise money for at the very least. They may have existing programs you can use for your fundraising.
posted by mathowie at 4:19 PM on January 16, 2015

My advice is to avoid premiums. Simply ask for money. Premiums are only necessary if you think the charity is a really hard sell. The cost and extra work of premiums usually does not justify their use in a fundraising drive, even for organizations (like public radio stations) that always use them (they're stuck: their listeners expect them, but they do sometimes have "no gift needed" options on premium-based campaigns). You'll see that many Kickstarter campaigns have figured this out and do a lot of intangible premiums -- "our everlasting thanks" or "a mention on our website." One campaign I was recently involved with offered a premium of simply shouting donors' names from a high place.

My question I put to people who want to run premium-based campaigns: have you sent out wedding invitations or holiday cards lately? Well, premium campaigns are that kind of hassle times a thousand.

You'll find, I think, that making a really good case for altruistic gifts -- "I'm giving because I believe in the mission" -- is a much better way to raise money, a lot less trouble, and usually results in a greater net amount.
posted by Mo Nickels at 4:41 PM on January 16, 2015

Please contact the charity. They might already have a platform that works with their systems. By put up a website do you mean set up a page with an existing site like Razoo or something similar?

You'd also want to talk to them about your idea for premiums. That will really complicate things for them as they're the ones that would have to issue a tax letter and would have to specify how much is tax deductible (donation - value of the premium).

btw if you use Kickstarter or some other platform where the money goes to you directly and then you pay the charity they may only be able to issue a tax letter to you since you name is connected with the money.
posted by oneear at 4:58 PM on January 16, 2015

There are some great websites that do this. I'm not sure if they will share your donors' (who donate directly to the charity through your page) addresses with you, though -- you'd have to look into that.

Razoo
Go Fund Me (a more limited selection of charities, I think)
Crowdrise

Please do contact the charity's fundraising team, though! They will be a little weirded out by you using their charity's name without their permission and may ask you to stop - but if you ask ahead of time, they will probably like it!
posted by amaire at 5:11 PM on January 16, 2015

I'm going to disagree with Matt, because I think the problem he references is specific to trying to raise money without using a service designed specifically for that purpose, and doing it for multiple charities instead of one designated charity.

I help run a nonprofit and have done many, many of these online fundraisers - and have facilitated a lot of other people doing them as well. There are a whole bunch of sites made for this. Don't use Kickstarter - Kickstarter is not made for this, as you noticed.

I like Razoo (linked above) because the fee comes out of the donation, and the donor can choose to give extra to cover it.

There are also others like FirstGiving, GoFundMe, and CrowdRise. (On preview, same as what amaire said!) Most of these take around an 8% fee. There's also SeeYourImpact - but your charity has to pay a fee to be a part of their site, so it's only worth it for them if they expect people to use the site regularly to raise money.

On preview, it's not a bad idea to contact the charity's fundraising team, but it's highly unlikely they will have any problem with you raising funds for them unless there is going to be something weird or controversial about your fundraising page.

I don't believe any of these will send you money for shipping. They send the money directly to the nonprofit at the Guidestar listed address of record the month after the money is raised, that is how they keep their books straight and don't run into problems like Matt did.
posted by treehorn+bunny at 5:17 PM on January 16, 2015

Regarding the tax question, when you give via these sites, you get an emailed receipt to use for tax purposes. The receipt will say something like "No goods or services were provided in exchange for your contribution." (that's from Crowdrise's receipt).

Razoo's says: "Your donation of $XX.00 is being made to Razoo’s nonprofit partner, the Razoo Foundation (the “Foundation”), who will then distribute the funds to your designated nonprofit(s). As the Foundation is the organization processing the transaction, your credit card statement will list Razoo Foundation, rather than the name(s) of your designated nonprofit(s).
The Foundation is a public nonprofit exempt from tax under section 501(c) (3) of the Internal Revenue Code, and you did not receive any goods or services in exchange for your non-refundable contribution. Accordingly, your contribution may be deducted to the extent allowed by law."

So unfortunately in order to keep their contributions tax deductible, you'll have to just appeal to people's philanthropic spirit rather than offering a premium.

On one hand, the vast majority of people do not itemize their deductions anyway, so it actually makes very little difference whether they make tax deductible donations. However, people like to have the idea that they are doing something potentially tax deductible, so it's still important for promotional purposes.
posted by treehorn+bunny at 5:27 PM on January 16, 2015

Thanks, folks, those are some great tips. For the reasons mathowie lists, the goal is to do as little as possible on my own, so the fact that there are reputable services that handle all formalities correctly is very convenient. (On preview, what treehorn+bunny said.)

I hadn't considered how the charity might be concerned about the nature of the premiums and the fundraising page, but of course this makes sense---it would be awkward to mail out coupons to a churrascaria restaurant for donations to PETA, say. I would contact the charity if things were to proceed from here.

In my case, the premiums are of token value, on the order of a handmade greeting card. I enjoy making them---which makes this a little less tedious than sending out wedding invitations---and I feel like others would enjoy having them, too. They aren't too hard to make, but they aren't zero-effort either. I don't need the money from selling them directly, so why not divert payment to a charity.

I would collect the cash myself as if I were selling the items directly, then give proceeds to the charity, but that's more of a hassle for me (taxes etc.), and also people (a) have to trust that I'm not a scam (b) don't get a tax benefit.

It feels like there could be a way for all this to work, but the pieces aren't quite put together right now, and there probably isn't much demand for it. I could see it being useful for artists and performers putting on a show for a charity, though.
posted by tss at 5:38 PM on January 16, 2015

I work in a npo fundraising department, and we LOVE when folks do stuff like this!

A lot of artists sell their work and donate a percentage to charity. I also know a lot of folks who have hosted an event, dinner or crafting night where people all donate to a charity designated by the organizer.

I know this is a little old school, but if you are 'real life' friends/acquaintances with the folks you'll be asking to donate, you may have an easier time just asking folks to write checks made out to the name of the non-profit organization you want to support.
posted by nerdcore at 6:41 PM on January 16, 2015

It's an issue of both tax and trust. If you had sold a tshirt for $30 where $29 was the cost of the premium and only $1 went to charity, and the donor was able to claim $30 in tax relief, then you could do a pretty neat tax dodge for commercial stuff. There's stuff like donations of goods where people claim full market value for stuff that is ratty and used as a tax dodge thing.

Then it's about trust - if the funds don't go directly to the charity and the charity has vouched in some way for the premiums being what they are (t-shirts bought from a sweatshop in China with labels replaced to claim they're fairtrade in Kenya) - the charity can get its reputation ruined.

Lots of people raise funds for charities the way nerdcore suggests and the checks are written straight to the charity, or grouped together and put together as a single donation. The key is costs. If you had a dinner party where everything was donated or volunteered, no-one minds all the money put together in a single donation, but if you had an event where $9K went on the catering and $10K was raised in donations so only $10-$9= $1K went to charity, with people believing the event was to raise funds, people would feel misled and blame the charity as much or more than the person organising the event.

If you're donating the premiums and getting people to donate directly to the charity, most charities will be happy to work with you setting up a personal fundraising page once they've vetted the premiums (like postcards of arty painted nudes might not be the best premium for a children's charity)
posted by viggorlijah at 5:16 AM on January 17, 2015