Colorful clay figures of a police man and business man with a bag of money

Cooperative fundraising / IFAs

"Cooperative fundraising" is when a group's members join together (cooperatively) to raise money and then credit the funds raised (or the time spent volunteering) to the individuals who participated in raising the money (the accounts credited are known as "Individual fundraising accounts"). These types of activities, while common among booster clubs, are not considered a 501(c)(3) tax-exempt activity.

Tax-exempt 501(c)(3) organizations must be operated for a "public" purpose. Booster clubs, for example, often operate for public purposes such as supporting amateur athletics, supporting arts in the schools, community support for public education and the like. The IRS and tax court have both found that cooperative fundraising activities are operated for the private benefit of the individual members of the group involved in the fundraising. This type of cooperative fundraising may be engaged in by a for-profit, tax-paying organization, but not by a nonprofit, tax-exempt 501(c)(3) group. If cooperative fundraising comprises any significant part of your group's total activities (think more than 5% of total funds raised are credited to the individual accounts of parents/students participating in the fundraising although the IRS does not have a specific percentage test), then your group likely would not be considered to qualify for 501(c)(3) status by the IRS.

PBUSA highly recommends avoiding the use of Cooperative Fundraising or Individual Fundraising Accounts entirely. See the PBUSA IFA Policy. Other fundraising options include:

  • Fair share donation plans -- in which your organization advises parents/students of the cost of participating and encourages, but does not require, that contributions of a set amount be paid
  • Seeking out corporate, foundation and other donations, letting the donors know that contributions are tax-deductible provided nothing of significant value is received for the donation
  • Using all funds raised to support the entire group, regardless of volunteer or fundraising participation

Related articles

IRS Article - Athletic Booster Clubs: Are They Exempt?

Tax Court Ruling - Capital Gymnastics: August 2013

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Booster Club Fundraiser Ideas That Work

Sandra Pfau Englund

Jan 08, 2020

Raising money for the students at your school is always important. Government tax funding usually doesn’t cover all the costs of a great education system. So, it's essential for parents, administrators, and teachers to all pitch in on fundraising. One of the best, and structured, ways to raise money is by creating a booster club. All you have to do is incorporate, obtain your tax exemption, get an EIN, and register with your state. A booster club then allows your group to raise funds for your school with all the benefits of making charitable donations for donors. The primary goal of a booster club is to raise support for the school, including extra funding, so let's take a look at the top booster club fundraiser ideas.

Community Fundraising Ideas for Booster Clubs
1. Membership fees must comply with law

One of the top booster club fundraiser ideas is to accept membership fees. However, it's important to note that while you may charge membership fees, it is vital to understand the laws regulating that revenue. Thus, for more information to ensure you comply with all laws, take a look at experts in the field, such as Parent Booster USA.

2. 5K Fun Runs bring together your community

Do you want to get everyone in your community involved in one of your fundraising ideas for booster clubs? Well, a 5K walk/run might be the right fundraiser for you. Recruit a team of volunteers who will help you plan this kind of fundraiser. Then, charge all participants for walking/running the race. You'll need to get the necessary permits for the route, but a 5K fun run is great because it involves your entire town. So, take a look at these tips for planning your fun run for great success.

Digital Fundraising Ideas for Booster Clubs
3. Charity auctions with or without an event

Have you ever considered an online charity auction? It's one of the best booster club fundraiser ideas, done conveniently online. Sure, you can combine an online auction with a fundraising event (e.g., sporting match, dinner, etc.), but it's also a great stand-alone fundraiser. So, all you have to do is get a charity auction platform, auction items, and then promote away. Remember, travel, spa, and sports items do very well in this fundraiser. Check out these dos and don'ts for an auction.

4. Email flash fundraiser for one day only

Yes, email still works. In fact, one-third of online fundraising comes through email. For a flash fundraiser, pick a day where you're going to blitz your donor base through email. For success, you'll want to ensure you have a compelling story and a sense of urgency for the funds. And don't forget to include videos and photos for your flash fundraiser. Also, remember that while you will get responses to this fundraising idea through email, you will want to also share across social media. Set a financial goal and tell everyone that you need the funds by the close of the day. 

Sports events for booster fundraiser ideas
5. Championship event fundraiser for your booster club

Playing sports is a big part of school life, and it can serve as the center for fundraising events. As a result, one of the most fun (and competitive) booster club fundraising ideas is a fundraiser tied to a championship. Perhaps your students have made the cut at the national level, state, or local levels. Or, maybe it's the last game at your school before vacation. Whatever the reason, select a game that is special and then raise money around it. Ask all parents to get involved and promote your event on social media. When people arrive to see the game, you can charge an admission fee for entrance to this special game.

6. Raise money with a pitch-a-thon

Everyone likes a little bit of competition. Therefore, with that in mind, one of our other excellent booster club fundraising ideas is a pitch-a-thon. It's easy to get one together during any time of year. Before any sporting event at your school, get the crowd motivated by inviting anyone to throw the fastest baseball pitch. But, you're not limited to baseball. See who can kick a soccer ball the farthest or throw a football. You can plan it yourself, or work with a third-party partner to help you prepare it. However, charge participants and attendees to this fun event.  

Creative fundraising with no selling or asking for money
7. Shoe drive fundraiser

Finally, one of the most creative booster club fundraising ideas is a shoe drive fundraiser. You can raise school and team spirit by having different grades and classes compete against each other. All your booster club has to do is collect gently worn, used and new shoes. And, once the event is finished, you get a check. Not only will this fundraiser raise funds for you, but it's a socially responsible fundraiser. Meaning, you support the planet and also micro-entrepreneurs working to help themselves out of poverty.


The easiest way to get and keep tax-exempt status

Mountains