Charitable Solicitation Registration & Multi-State Compliance Video Library
Do Grants Count as Solicitation?
Part of the Multi-State Fundraising Compliance Series. It is design to provide practical guidance on charitable solicitation registration and multi-state fundraising compliance.
Video Overview:
Many nonprofit organizations receive funding through grants from foundations, corporations, and government programs. Because grant funding plays such an important role in nonprofit financing, organizations often ask whether applying for grants counts as charitable solicitation under state registration laws.
Charitable solicitation regulations generally apply when nonprofits request donations from the public. Grant applications, however, are often directed toward specific institutional funders rather than the general public.
This video explains how grant funding is typically treated under charitable solicitation laws, how regulators distinguish grant applications from public fundraising activity, and when grant-related activity may interact with broader multi-state fundraising compliance considerations.
This video explains how grant funding is typically treated under charitable solicitation laws and when grant activity may or may not trigger registration requirements.
This video is part of the Multi-State Fundraising Compliance Series, which explains charitable solicitation registration and nonprofit fundraising compliance requirements across the United States.
Key Topics Covered
- What qualifies as charitable solicitation under state law
- How grant funding differs from public fundraising
- Why grant applications to foundations are often treated differently
- How corporate and institutional grants fit within fundraising activities
- When grant-related activities may overlap with charitable solicitation
- How public fundraising campaigns can affect compliance analysis
Who This Video Is For
- Executive directors launching fundraising expansion
- Development teams building online campaigns
- Finance and compliance staff overseeing registrations
- Boards evaluating regulatory risk
- Organizations expanding fundraising beyond their home state
Video Summary
Grant funding is an important source of revenue for many nonprofit organizations. Foundations, corporate giving programs, and government agencies frequently provide grants to support nonprofit programs and initiatives.
A common compliance question arises when nonprofits apply for grants from organizations located in other states: does applying for a grant count as charitable solicitation under state registration laws?
Charitable solicitation laws generally regulate organizations that request donations from the public. These activities often include fundraising campaigns, donation appeals, advertising requests for contributions, and other public-facing fundraising initiatives.
Grant applications are typically different from public fundraising. When a nonprofit submits a grant proposal, it is usually responding to a structured funding opportunity offered by a specific institutional funder rather than requesting donations from the general public.
These institutional funders may include private foundations, corporate foundations, philanthropic organizations, and government grant programs. Because grant proposals are directed toward specific funding organizations, many states do not treat these activities as charitable solicitation.
However, charitable solicitation registration requirements are usually evaluated based on an organization’s overall fundraising activities. If a nonprofit conducts public fundraising campaigns alongside grant applications, those broader activities may still trigger registration requirements in states where donations are solicited.
Because charitable solicitation laws vary by state, nonprofits often review both their grant funding strategies and their public fundraising activities to determine how compliance obligations may apply across multiple jurisdictions.
Unsure whether your nonprofit needs to register before fundraising in other states?
We help nonprofits evaluate requirements across all states.
About the Multi-State Fundraising Compliance Series
The Multi-State Fundraising Compliance Series is an educational video series explaining charitable solicitation registration, multi-state fundraising compliance, and related nonprofit regulatory requirements. Each video addresses a specific compliance question commonly faced by nonprofit executives, development teams, and finance leaders.
Full Video Transcript
Do Grant Applications Count as Charitable Solicitation?
You know, if your nonprofit applies for grants, you might be taking on legal risks without even realizing it.
Welcome to our explainer on multi-state fundraising.
Today, we’re going to break down a really crucial question:
Do grant applications count as charitable solicitation?
Introduction
This explainer is brought to you by Ironwood Registrations, a firm dedicated to helping nonprofit leaders and finance teams navigate these complex issues.
The Core Question
Here’s the question many nonprofits face:
If you apply for grants from foundations, corporations, or government programs, does that activity count as charitable solicitation?
And if you apply for a grant in another state, do you need to register there?
The answer is:
It depends.
The key factor is who is providing the funding.
What Is Charitable Solicitation?
Before evaluating grants, it is important to understand the definition of charitable solicitation.
At its most basic level:
Charitable solicitation is any request for a charitable contribution.
Most states require nonprofits to register before asking their residents for donations.
This includes:
- Fundraising campaigns
- Email and mail appeals
- Advertising for contributions
- Fundraising events
- Website donation requests
Applying the Definition to Grants
Not all grants are treated the same under these laws.
There are two main categories:
- Government grants
- Private grants
Government Grants
Government grants are generally not considered charitable solicitation.
Why?
Because they are treated as procurement.
When applying for a government grant:
- You are participating in a formal public funding process
- You are not requesting a private donation
This applies to:
- Federal grant programs
- State agency funding
- Local government grants
These typically do not trigger registration requirements.
Private Grants
Private grants are treated differently.
These include:
- Private foundations
- Corporate foundations
- Corporate giving programs
From a legal standpoint:
These entities are considered part of the public.
When you submit a grant application to a private organization, you are:
Requesting a charitable contribution
Compliance Implications
Because private grant applications may be considered solicitation:
- They can trigger charitable registration requirements
- This is especially relevant when applying across state lines
Multi-State Considerations
If your nonprofit is based in one state and applies for a grant from a private foundation in another state:
You may need to register in that state
This means grant-seeking should be included in your compliance planning.
A Proactive Approach
Before submitting grant applications, organizations should consider:
- Where the funder is located
- Whether the funder is public or private
- Whether registration may be required in that state
This helps avoid compliance issues.
Key Takeaways
- Not all grants are treated the same
- Government grants are generally not considered solicitation
- Private grants may be considered solicitation
- Private grant applications may trigger registration requirements
- Compliance planning should include grant-seeking activities
Final Thought
Understanding this distinction allows nonprofits to grow their fundraising efforts while maintaining compliance.
The key question is not just whether you are soliciting—but:
Where and from whom are you requesting funding?
FAQs
Are foundation grants considered charitable donations?
Foundation grants are typically structured funding awards rather than public charitable contributions, which is why they may not always fall under charitable solicitation laws.
Does applying for grants in another state require charitable registration?
Often it does not by itself, but registration requirements may still arise if the organization conducts other fundraising activities directed toward donors in that state.
Do corporate grant programs count as solicitation?
Corporate grant programs usually involve structured application processes directed to a specific institution rather than public fundraising campaigns.
When could grant-related activities affect charitable solicitation compliance?
Grant-related activities may affect compliance when they occur alongside broader public fundraising campaigns that solicit donations from residents of multiple states.
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