Co-written with Devin Balkind. Much love to Drew Hornbein, Seamus Brugh, and Mark Ferlatte for their input on this piece. 

At some point, if you are visible enough, people will want to give your group money to do what you’re doing in responding to the crisis. 

Ideally, you will have been tracking who is putting money into the response so you can later pay them back if outside donations start coming in. Have a spreadsheet somewhere that folks can see (but not necessarily edit – see “data security”).

Some quick models that might work for you

If you want to be able to take tax deductible donations quickly, you can partner with a 501c3 in something called fiscal sponsorship where they take the donation and then pass it through to you after taking a small amount as administrative overhead (I’ve seen 10% most often). Some bureaucracy and you have to partner with an org that is values-aligned. You’ll want to take a look at a Memorandum of Understanding (MOU) to see how these partnerships are set up.

If you want to move fast and are expecting small amounts of donations, and don’t care about tax deductible donations, you can just open up a business bank account as a sole proprietor. There will be confusing tax implications later, someone in your group who has been an independent contractor will have insights. If you want more folks on the account it can get more complicated by needing to form a business or nonprofit (see below for when you have more time), but a local bank or credit union will want to help you figure it out. 

Framing conversations about dealing with money

Money often starts coming in AFTER you’ve already figured out what you’re doing and why. But people will start to see what you’re doing after you’ve been doing it, and want to support you in doing so. This means some of the tenor of your work will already be shifting as funds start coming in. You’ll be shifting from the response phase (getting people off of roofs and from under rubble) and into the recovery phase (getting people food and medicine, gutting houses, setting up warming shelters; longer term rebuilding housing, reestablishing businesses).