How to obtain funds from the U.S. for your nonprofit?

73% of social organizations in Latin America consider that their biggest challenge is limited budget*. The lack of funding opportunities in the region drives many to seek resources abroad.

In the United States, there are thousands of funding opportunities*. Foundations, corporations and individuals have donated over USD $557 billion to social initiatives worldwide. Connecting with international opportunities can boost your fundraising efforts, opening new doors to fund high-impact projects.

Beatriz Guillén, Executive Director of The Resource Foundation, joined us at a Propel event where she shared tips on raising funds in the U.S.

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1. What donation model should you use?

The Donor-Advised Fund (DAF) allows individuals and organizations to donate through a sponsoring organization, with the ability to advise on how funds are invested and offer ongoing support.

Beatriz considers it the most effective donation model. Here are some of her tips:

• Know the key players: Identify different types of DAFs and adjust your strategies.

• Engage: Ask your donors if they have a DAF in surveys or conversations.

• Make yourself visible: Keep your Candid Guidestar profile updated and provide your tax identification number (EIN) on your website and materials.

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2. How can you receive funds from the U.S.?

Here are the legal mechanisms you can consider:

• 501(c)(3) Status: By registering your organization under this section of the U.S. Internal Revenue Code, you can receive tax-exempt donations.

• Equivalency Determination: A process that verifies whether a foreign organization meets the requirements of a 501(c)(3), allowing it to receive funds without tax penalties.

• Fiscal Sponsorship Fund: Enables you to receive tax-free donations without having 501(c)(3) status. An organization with this status can manage donations on behalf of the project in compliance with U.S. tax laws.

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How to attract U.S. donors?

• Build strong connections: Develop support networks with key individuals and strategic allies.

• Strengthen your communication: Position your organization through social media, email, and your website.

• Create content: Beyond a monthly newsletter, studies and publications will help solidify your image as a strong, impactful organization.

If you want to learn more about donor retention, check out this blog.

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As part of the Propel Community, we support you in applying for more funding opportunities. Join the waitlist for our fellowship to enhance your social work here.

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Written by Alexandra Guerra.

*References: Propel | Grants.gov