Fiscal Sponsor
An established 501(c)(3) organization that provides its tax-exempt status and administrative infrastructure to a project or group that lacks its own exemption.
Fiscal Sponsor is a term from U.S. nonprofit financial reporting — typically a line item or schedule on IRS Form 990, the annual disclosure tax-exempt organizations file. The definition here is the IRS-file usage, which can differ from how the term is used in general financial writing or accounting standards. On the LakeQuality nonprofit efficiency rubric, Fiscal Sponsor feeds into one of the four scoring factors (program ratio, revenue growth, reserves, or CEO compensation). Understanding how the term is computed at IRS is part of reading nonprofit pages defensibly.
Each nonprofit page on the site surfaces the specific Fiscal Sponsor value for that organization (when Form 990 reports one), so the general definition here translates into a concrete data point on the per-nonprofit pages you actually use.
Fiscal sponsorship is an arrangement in which an established 501(c)(3) tax-exempt organization (the fiscal sponsor) extends its legal and tax-exempt status to a project, group, or initiative that does not have its own 501(c)(3) determination. This allows donors to make tax-deductible contributions to the sponsored project through the sponsor, and it enables the project to apply for grants that require 501(c)(3) status. Fiscal sponsorship is commonly used by newly formed organizations awaiting their own IRS determination, community projects that may not need permanent nonprofit status, artistic and cultural initiatives, and social movements. There are two primary models: Model A (comprehensive or direct project) where the project is a program of the sponsor and the sponsor maintains full legal and fiduciary control, and Model C (pre-approved grant relationship) where the sponsor makes grants to the project, which operates with more independence. The National Network of Fiscal Sponsors has established guidelines and standards of practice for this arrangement. Fiscal sponsors typically charge an administrative fee of 5-15% of the project's budget. On Form 990, fiscally sponsored projects appear within the sponsor's financial data, which means a large fiscal sponsor's revenue and expenses may include multiple distinct projects. Donors researching fiscally sponsored projects on NonprofitTruth should be aware that the financial data reflects the sponsor organization's aggregate operations, not the individual project.