Fiscal Sponsorship with ASI

What is Fiscal Sponsorship?

If your arts or culture project has a public benefit, you could use a fiscal sponsor to access funding from corporations and foundations and collect tax-deductible donations.

Fiscal sponsorship is a contractual agreement between a 501c3 nonprofit organization and an individual or collective whose activities fall within the sponsoring organization’s mission. This arrangement allows the 501c3 organization to extend certain nonprofit benefits to the sponsored group or project without the group needing to file for nonprofit status. In exchange, the group or individual shares a portion of the funding with the nonprofit to cover their operations.

It’s important to note that sponsored projects must have a public benefit – you can’t profit from charitable funding and donations. The purpose of sponsored work must be community-centered and charitable in nature.

How ASI’s Fiscal Sponsorship works

ASI provides fiscal sponsorship support to artists and arts collectives based in the five counties of Western New York (Erie, Niagara, Chautauqua, Cattaraugus, and Allegany).

While there are many different types of fiscal sponsorship models out there, ASI uses fiscal sponsorship Model C. With this type of fiscal sponsorship model, the individual or collective remains a separate entity from ASI and is responsible for managing their own tax reporting and liability issues. ASI simply provides access to funding opportunities and ensures that any funding received will be used for the stated purpose described in the grant proposal or funding agreement.

All contracts with ASI must be renewed or considered annually. Completed projects can be closed at any time throughout the year.

Below is a breakdown of responsibilities:

Individual or Collective	Arts Services Inc. (ASI)
Finds funding opportunities	Assists with questions and offers tips and suggestions, as needed
Writes grant and sponsorship applications	Reviews and submits completed grant and sponsorship applications on behalf of the Client
Determines how funding will be allocated and requests payouts as needed	Pays out funding as determined by Client; provides regular updates on account balance and sends award notifications and updates
Maintains full artistic control over their projects	Monitors artistic activity to ensure the work continues to align with ASI’s mission and the grant’s priorities
Manages and completes all required reporting	Reviews and submits reporting on behalf of Client
Responsible for paying taxes on earned income and any required taxes for their business transactions	Processes 1099’s and other tax forms for individuals and LLC’s paid on behalf of a sponsored project
Secures individual donations and gifts	Processes tax acknowledgement letters for each gift received

This format is perfect for short-term projects, projects with small teams, and those who want control over their work. While this format allows for more independence artistically, it does come with more administrative burden on the individual or collective than other models.

What ASI does not provide

While ASI’s staff are happy to provide assistance and support to our fiscal sponsor clients, there are certain limitations based on our fiscal sponsorship model.

ASI is not your development or fundraising staff
ASI is not your grant writer
ASI cannot provide a database of potential donors
ASI is not your business’s bookkeeper
ASI cannot file your personal or business taxes
Sponsored projects cannot utilize ASI’s sales tax exempt form
Sponsored projects and events are not covered by ASI’s insurance
ASI cannot guarantee you will raise funding for your project
Fiscal sponsor clients are not representatives of ASI and cannot act on behalf of ASI, including signing contracts and agreements for sponsored funding

If these are the kinds of services you are interested in, you will want to find a fiscal sponsor who uses Model A. Under Fiscal sponsorship Model A, sponsors take on all sponsored projects as their own programs. While the individual or collective may lose some artistic control over their project, they will be provided with more back-end support and management from the sponsor than ASI can provide.

If you’re ready to consider ASI as your fiscal sponsor, please complete our Fiscal Sponsorship Interest Form. If you meet our eligibility and your project aligns with our mission, you will be asked to do a phone conversation with our staff and provide additional information about your project.