Can Two Nonprofits, With Very Different Missions, Hold A Joint Fund-Raiser?

That was a question that recently found my email inbox, along with the explanation that one of those organizations has a medical focus, the other is in the arts.

My immediate thought/response was, simply, “Yes.”

You just have to be sure that both organizations have a signed agreement as to how the expenses will be paid, and by whom; and, it must be clear to event attendees how/if the funds raised will be split between the two organizations, and what that split will be.

The one “problem” you might encounter is how to acknowledge contributions to the event. Do donors get a choice which NPO they support, or what percentage of their gifts go the which org? Which organization gets the names and contact information of the ticket buyers/attendees/donors? How will the thank you note and/or receipt be worded?

Of course, if tickets are sold for the event, it must be made clear what percentage of the ticket cost is tax deductible. The IRS is very picky about that.

The best way to cover all the bases is to be totally transparent — to make it clear, up front, how the expenses are being covered and how the net is being split.

That response evoked the following:

What if the organizations do not do what you have explained above?

I simply know that someone is having a fund-raiser with two completely distinct and different non-profit organizations. One is receiving all the monies raised while the other in bringing in the “clients” to donate. None of the donors knows the way the funds are being disbursed.

They are advertising that the ticket cost is tax deductible. But they do not say if the two non-profits will both receive funds.

Should I mention something to the hosts or just not worry about my donation and tax deduction to be legit ??

The IRS makes it clear that the cost of a ticket cannot be fully deductible if the purchaser is to receive any “real” benefit. And, if the IRS learns to the contrary, both organizations could put their (c)(3)s, and their donors, in jeopardy.

To not fully inform those people who are expected to buy tickets, is to risk both organizations’ credibility/standing in the community.

It sounds like what you are describing are a couple of amateur organizations — with no professionals in the development office, and no educated board members.

The questioner then wrote that he/she has “donated a significant sum to this non-profit — worrisome indeed for us that have.


If the “board” of these non-profits will not heed any advice given, is there recourse or a way to inform the IRS of the wrongdoings of this organization? There are many abusing the non-profits for their own advantage.

My final thought: The donor is always better off donating directly to a nonprofit, instead of through a so-called fund-raiser.

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