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CalAttorney2
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Category: Business Law
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Experience:  I am a businesses law attorney, with experience advising and representing owners and investors.
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Can I start a fund raising company that will raise money

Customer Question

Can I start a fund raising company that will raise money for a nonprofit organization without being directly affiliated with that company?
Submitted: 1 year ago.
Category: Business Law
Expert:  CalAttorney2 replied 1 year ago.

I would not recommend doing this. Your donors would not be able to get their tax deduction from you (by donating money to the non-profit they are entitled to a tax deduction, but they only get this if they get a receipt from the tax exempt non-profit entity).

So the people that you are getting to donate money are doing so without the benefit of the tax deduction.

In addition, you also need to be very careful in how you use another entity or company's name or likeness. While you are likely only planning on using the organization's name in a positive way, their image is their property and how they choose to market and craft their image is theirs. Some businesses choose to do fundraising in very specific ways, and avoid others. They make these strategic decisions based on public perception and fundraising goals, which may not be readily apparent to outsiders.

While it may not be likely that you would face legal action due to raising funds for a non-profit without prior permission, be aware you may be contradicting their internal goals and policies (you may be hurting rather than helping).

Your best course of action is to actually contact the entity directly and ask to volunteer your time and help with fundraising directly. They may be interested in partnering with you (allow you to raise funds independently - you still have to deal with the tax issue above), but you will want to coordinate with them.

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