Many nonprofit myths circulate through the general public by word of mouth and it’s time to dispel them. Nonprofits make a difference in communities across the globe. Above all, a nonprofit organization is created with the goal of providing a public benefit. However, even to this day, nonprofit myths sometimes prevent nonprofits from seeing success. Not to mention, especially nonprofit startups. GrantWriterTeam is here to debunk those nonprofit myths and to set the record straight.
1. Nonprofits Cannot Earn A Profit
Did you know, that nonprofits CAN and SHOULD earn a profit? Profits provide the funding nonprofits need for their cause. In truth, just like a business, nonprofits pay salaries and have overhead costs. However, in this case, profits cannot be distributed to an individual. The funds must support the outlined mission statement. Above all, nonprofits spend 75%-80% of total expenses on programs.
2. Nonprofits Should Have Low Overhead
The IRS regulates nonprofits to ensure funds are benefiting a cause. To illustrate, nonprofits are to use any remaining funds after paying operating expenses, like employee salaries to accomplish their mission. Ensure your nonprofit does not exceed an overhead rate of 35%. Any amount higher should prompt an audit to see how a nonprofit’s budget can be refined.
3. Recruiting Volunteers Is The Only Way To Staff A Nonprofit
Nonprofits have staff and salaries too. To illustrate, nonprofits employ over 10% of the workforce. However, nonprofits do utilize volunteers and the value of volunteers is growing every year. It is important to pay your staff a fair wage, do not over-pay the CEO of a nonprofit, as this can lead to time-consuming and unnecessary auditing.
4. Nonprofits Are Always Funded By Grants
Grants are not the only source of funding for nonprofits, by far. In reality, many successful nonprofits adopt a donor-centric management style to increase their donations. Nonprofits utilize large sponsors. For example, a local business may provide a meeting place. Alternately, an active nonprofit aligned with the cause may offer a letter of support promising In-Kind support.
5. Charitable Giving Only Benefits The Wealthy
Tax laws encourage individuals and businesses to give to charitable organizations. Donations help nonprofits find their cause. Many large corporations and philanthropists enjoy the benefits of giving. However, tax laws may encourage individuals and businesses to give to charitable organizations. If you believe in a cause there are many charitable giving incentives that individuals can benefit from.
How To Find Grants For Nonprofits
Grants provide funding that you do not have to pay back. Locate grants with the SMART Advanced Search filter. In short, this tool allows you to search by recipient type, location, category interests, funding source type, and deadline date. On the grant detail page, you will see eligibility requirements, the deadline, the application, and more. Once you apply for a grant, add your grant applications using the GrantWatch Personalized Grants Calendar to keep track of your grant applications.
Are you a nonprofit or small business in need of some help? If you are searching for grants but are feeling overwhelmed, hiring a grant writer may be the perfect choice for you! Grant writers thoughtfully grant opportunities and consider the pros and cons of applying and the chance of success. Consider your writer an extension of your organization. They will coach you throughout the entire process and curate the project to fit your needs. Your grant-seeking success is our priority at GrantWriterTeam.