Using 990s in Foundation Research

17 March 2015

You’ve seen their names on buildings and programs, in honor rolls and news articles: there are many charitable foundations located right here in the great state of Utah, and they are giving away millions of dollars each year. But how do you tap into that wealth? How do you know if they’ll even be interested in what your nonprofit does?

A good first step is to check out the Form 990 returns all private 501(c)(3) foundations are required to file annually.

This form can be viewed by a variety of means, but one of the most convenient—and free—is GuideStar.org. You can buy a GuideStar membership that will give you access to additional resources, but registering for a basic GuideStar account is free. Once in their system, you can search for organizations by name, location, income level, or other classifications.

I’m not recommending this necessarily as a way to discover foundations that you haven’t already heard of (though with a little practice in GuideStar searching you should be able to do that), but rather to look up the 990 of a specific foundation and gather information to determine if it is a likely prospect for your organization.

What You Can Learn from a Form 990
The most beneficial info the form provides is the list of donations the foundation made in the tax year reported. This tells you what causes and organizations they support, giving you an idea of the current directors’ interests (which may be different from the original and stated mission of the foundation). Most important, it tells you how much they gave to each of them.

The 990 also lists current board members, which you can share with your own board, staff, and volunteers to find connections. This is particularly important in the cases of foundations that don’t accept unsolicited applications. And how do you know if they do or not? Again, the 990 helps: In section XV the foundation will check a box if it “only makes contributions to preselected charitable organizations and does not accept unsolicited requests.”

Besides their detailed giving history, the form states the foundation’s income, expenditures, salaries for directors and staff, investments, and all the financial minutia you could ever want. Sometimes it provides gems like revised bylaws or other peeks behind their curtains.

Remember: Successful fundraising requires matching your organizations’ needs with donors’ interests. Spending hours analyzing a foundation’s 990 isn’t going to bring in the money if there just isn’t a match. But a quick scan of it can tell you if there’s a possible connection and can give you information you need to craft a well-targeted proposal.

—by Jeff Driggs

Jeff Driggs is director of foundation relations at Westminster College. He has more than 30 years of professional experience in higher education development in Utah.

Want to hear more from Jeff on this subject? Don’t miss his upcoming session, The Art and Science of Foundation Relations at Fundamentals of Fundraising.

Register today
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