Question of the Month - Legal Concerns For Asking Donors to Share Appeal for Support in Facebook, etc.

Question of the Month - Question of the Month 2009

When a 501(c)(3) nonprofit organization encourages its friends and donors to share an appeal for designated support with their friends through Facebook, My Space, LinkedIn, Twitter or other social networking, does this raise legal concerns?

Often a nonprofit has many supporters and donors for spreading an appeal for a specific ministry or project that may be popular and obtain more contributions than through the normal fundraising channels. However, it is important to not that the nonprofit is no longer in control of the solicitations, and if it is not registered for charitable solicitation in all 39 states and the District of Columbia, that nonprofit may now have to register in all these states. Unless exempt or otherwise excluded such as a church or church related entity, a nonprofit is normally required to register within any of those states before directly or indirectly soliciting charitable contributions.

Under the “Charleston Principles” of the National Association of State Charity Officials (NASCO) (www.nasconet.org), the Attorneys General will NOT usually require registration simply because a nonprofit may receive contributions on its website, so long as it is a “passive” site (no solicitations nor way to contribute online).

Encouraging supporters and donors to forward the fundraising message to friends wherever they are could be considered active solicitation which would trigger in kind Charitable Solicitation Registrations (CSR). If the supporters or donors were compensated in any way for forwarding the message, they would not have to be registered as fundraisers, which could inadvertently create a problem for them and the nonprofit. Finally, if the nonprofit organization receives a gift from a state in which it is not registered, it will need to determine whether it has to register before it asks for more.

For more information either email This e-mail address is being protected from spambots. You need JavaScript enabled to view it to ask for the article or members may download the article “Charitable Solicitations Requirements - Why Register?” from Memorandums section at www.nonprofitchurchlaw.org. (you must be logged in to access)