Is it possible for a nonprofit organization to raise a million dollars without spending a dime? How about hundreds of millions?
In their latest reports to the IRS, 15,398 large nonprofits said they had raised nearly $117 billion without spending anything for advertising, telephone solicitations, mailed donation appeals, professionally prepared grant applications or staff time for face-to-face pleas for contributions, Scripps Howard News Service reported Monday.
The Scripps study identified 22,598 nonprofit groups that did report fundraising expenses totaling some $14 billion, or about seven cents for every dollar raised.
By law, nonprofits owe no federal taxes on any funds they raise.
Scripps examined the latest annual Form 990s, documenting expenditures in 2010, 2009 or 2008, of 37,987 nonprofits that collected at least $1 million. Chief executives sign these reports to the IRS, affirming their accuracy “under penalties of perjury”—though legal action for a false filing is rare, Scripps said.
Industry experts told the news service that an accurate statement of fundraising expenses is critical to donors’ understanding how much of their contribution goes to a charity’s officially stated purpose.