Fundraising in California: An Overview of Charitable Solicitation Registration Requirements

Fundraising helps nonprofits raise the money they need to support their mission. However, navigating the regulations of state fundraising registration can be tricky, especially in highly regulated states like California. Whether you’re planning your first fundraiser or expanding your reach to the Golden State, this thorough guide will shed light on the intricate process of fundraising registration. We’ll discuss initial registration requirements, renewals, fees, and more, regarding the California fundraising landscape, allowing your organization to continue the mission with confidence in your compliance. Keep in mind, registration requirements may seem daunting due to nuanced regulations, if at any point you find yourself needing help navigating this complex world of compliance, Affinity Fundraising Registration is here to help.

Exemptions

The first step in the registration process is to determine if your organization qualifies for an exemption. Accredited educational institutions, nonprofit hospitals, religious organizations, and 501(c)(6) entities can qualify for an exemption to the charitable solicitation registration requirements in California, if they provide the following supporting documentation:

The founding document (such as the Articles of Incorporation)
An IRS determination letter
A detailed description of the organization’s activities (and website, if available).

If your organization is required to register, CA will request an initial registration form (CT-1) plus an initial registration fee of $100. If solicitation has already begun, an Annual Registration Renewal Fee Report (RRF-1) will also be required along with the annual fee which will be determined by your organization’s total income.

Initial Registration

Nonprofits are required to register in the state of California if you solicit funds or receive donations of $1 or more from residents of the state. CA law requires registration within 90 days of the first solicitation but generally doesn’t impose penalties or fines for failing to do so.

To register in CA you will be required to submit the following materials:

Initial registration form (CT-1)
Copy of IRS form 1023 (if incorporated after 1987)
IRS Determination Letter
Form 990 from the most recently completed fiscal year
Copy of the original Articles of Incorporation
Copy of the bylaws (if filing as an unincorporated nonprofit)
List of board members
Initial registration fee
Annual report fee
Completed GAAP-based audit (if gross income is $2,000,000 or greater)

Organizations can expect to receive a confirmation of their registration by mail from the state, and confirmation of receipt for an annual report. Alternatively, organizations can also confirm receipt by checking with the state’s online database.

For new organizations that do not possess a 990, you will only need to submit an initial registration form (CT-1). Your 990 will be due four months and 15 days after your fiscal year ends, along with your RRF-1 annual report.

All organizations will be asked to provide the date “assets first received in/from California,” meaning, the date when the organization first received a contribution from California. If a date is listed that is before the initial reporting period, the state will immediately mark your status as “Delinquent” and require you to submit back filings of your Form RRF-1, along with annual state fees for all fiscal years since the period in which funds were first received. It’s also worth noting that the RRF-1 has nine questions on it and if you answer “yes” to any of those questions, you’ll be required to provide an explanation, or appropriate additional documentation, for each reporting period.

Included in the CT-1 initial registration are two questions about whether the nonprofit organization is fundraising online on behalf of other entities as a “platform charity” or as a “charitable fundraising platform.” When the answer to either is yes, an additional reporting requirement will be involved with either the Form PL-1 or PL-3, respectively, to be followed by annual reporting with the Form PL-2 and PL-4 as needed. These Charitable Fundraising Platform filings are part of new regulation that passed in the state in 2022, and went into effect in 2023 with filings starting to be required in 2024. Details regarding these new regulations are still being ironed out by the state at the time of writing this article.

Annual Renewal Reports

Registrations must be maintained by filing annual reports with the Form RRF-1, which are due four months and 15 days after the close of your fiscal year.

For the annual report, you will need to submit the following materials:

Completed Annual Registration Renewal Report (RRF-1)
Signed Form 990
Form 8868 (if applicable)
List of board members
Completed audit, if one was completed (required when gross revenue is $2,000,000 or greater)
Annual report fee
Any required attachments (depending on how you answer on the RRF-1)

The state of California grants an automatic six-month extension contingent upon filing Form 8868 with the IRS. Extensions are not offered in advance, but rather upon submission of your filing. No other documentation or formal request for an extension is needed.

During the renewal process, your annual report can be submitted online as long as your organization’s status is shown as “Current”. The state will mark a filing as “Delinquent” once they have processed all filings received up through a due date approximately six weeks from the deadline. Once that occurs, organizations can only renew by mailing a hard copy of a signed RRF-1 renewal form. The delinquent status will remain until the state processes the filing.

Note that once the status changes to “Delinquent,” charities will also be added to the state’s “May not operate or solicit for charitable purposes” list. Third-party fundraising platforms are legally prohibited from allowing nonprofits to fundraise with their platform if their status in CA is not “Current” and/or appearing on the state’s may-not-solicit list. Regaining ability to use such platforms will be contingent on both locations, the database and list, updating an organization’s status.

You should also be aware that in extreme circumstances the state has been known to hold the board of directors personally liable for extreme compliance issues, making them pay the fine out of their personal pockets, and not allowing them to report the expense as a charitable contribution. This is just another reason to remain diligent about staying compliant.

Fees

The initial registration is a fixed fee of $50 when filing the CT-1, plus the annual fee if/when filing the RRF-1 renewal form. There are no late fees.

Fees for annual reports are based on the following scale:

Gross Income	Fee
<$50,000	$25
$50,000-$100,000	$50
$100,001-$250,000	$75
$250,001-$1,000,000	$100
$1,000,001-$5,000,000	$200
$5,000,001-$20,000,000	$400
$20,000,001 – $100,000,000	$800
$100,000,001 – $500,000,000	$1,000
>$500,000,000	$1,200

Back Filing

Back filing refers to the process of retroactively filing the necessary paperwork for a charitable organization that failed to register upon initial solicitation. If an organization has been operating as an unregistered entity they will need to back file for years in which they were active but not otherwise registered. The state will require the submission of an RRF-1 form along with supporting information, fees, the Form 990s and audits (if applicable) for the missing filing years, as described above based on date reporting assets first received in/from California per the form CT-1. Back filings can only be prepared and filed in hardcopy (not online).

Withdrawals

If a nonprofit organization ceases operations or decides to stop fundraising activities in the state, they need to formally withdraw their registration. To do this, they must submit an original letter on organizational letterhead stating the date solicitations ceased and requesting their registration be withdrawn. The letter must be signed by an officer of the organization.

After submitting the withdrawal, the state may also request a final state Form 990 for the most recently completed fiscal year along with the appropriate fees.

Reinstatement

Registration reinstatement in California involves a process to restore a charitable organization’s active solicitation status following its lapse or cancellation. Such a lapse can occur due to noncompliance with registration renewal regulations, failure to submit necessary documentation or the suspension of the organization’s operations.

To petition for reinstatement after revocation, an organization must provide the following:

Proof of compliance/good standing with the IRS, CA Franchise Tax Board and CA Secretary of State, if applicable.
All missed renewal filings, renewal fees, and 990 forms.
An explanation that covers:
- Why the organization failed to comply with the registration and reporting requirements, and failed to respond to notices from the Registry of Charities and Fundraisers.
- Assurance that there has been no loss of charitable assets and there will be no harm to the public with reinstatement.

If reinstatement is granted, there must be assurance that the organization will be able to comply with annual registration and reporting requirements and that violations will not reoccur in the future.

Fundraising Consultants

If your nonprofit is working with a professional fundraiser or fundraising consultant, they may be subject to specific requirements established by the state’s laws if their work occurred in or applied directly to the state. First, they may have to register with the California Office of the Attorney General before performing any fundraising activities and renew this registration annually. Additionally, they may have to have a written contract with the charitable organization for whom they are raising funds, before they engage in any fundraising activities. This contract will need to detail the fundraising activities that will be undertaken, the financial terms, and the duration of the contract. Fundraising consultants may also have to maintain detailed records of their operations and make these available to the AG’s office upon request.

Unique Challenges of Soliciting Funds in California

Even with all of the above, there are still yet more additional filings that may apply to entities fundraising and/or operating in California:

Foreign Qualification

Foreign Qualification is a process where a domestic nonprofit is granted the legal authority to conduct business in another state, apart from the one in which it was incorporated. Only foreign nonprofits physically operating in California or maintaining assets (such as a bank account) are required to register with the California Secretary of State’s office. When qualification fails to be maintained through an annual report, an organization’s “good standing” in CA will be impacted, preventing its ability to fundraise in CA and with third–party fundraising platforms.

California Franchise Tax Board Exemption

When qualifying to conduct business in California, charities must also register as exempt with the California Franchise Tax Board (CA FTB) with the Form 3500. This exemption must be maintained annually by filing the Form 199. When exemption fails to be maintained, an organization’s “good standing” in CA will be impacted, preventing its ability to fundraise in CA and with third–party fundraising platforms.

Third-Party Fundraising Platforms

Nonprofits frequently use social media and other third-party fundraising platforms as a way to expand their reach. Historically, these platforms have been less expensive and easier to use since they haven’t been subject to the same registration and reporting requirements. All that changed, however, with the new CA Assembly Bill No. 488 that became effective January 1, 2023.

This statute requires third-party platforms and the nonprofits who use them to register with the AG and provide detailed information about solicitations and their recipients. If a charity is also fundraising online on behalf of other charities, they may be subject to these additional filing requirements via Form PL-1, -2, -3, and/or -4. For more insights, please refer to our article on Fundraising on Facebook: A Warning to Nonprofits.

Raffles

Raffles are a popular fundraising strategy for charitable organizations. However, in California, they are not included in the same laws that cover other general fundraising activities. Although a nonprofit must still register with the CA Attorney General if they wish to hold a raffle, there are many other unique reporting and registration requirements that need to be met. For more information, please refer to the California AG’s page on Nonprofit Raffles.

Get Help with the California Fundraising Registration Process

Charitable solicitation registration requirements exist to ensure the transparency and trust that donors expect. However, the complexity of registration requirements in California often demands expert guidance. This is where Affinity Fundraising Registration can provide vital support to nonprofit organizations.

Regardless of your charity’s type, size, or location, our team is dedicated to helping your organization meet all of the essential requirements. With a wealth of experience and three different levels of customizable support services, we are well-positioned to assist your nonprofit in navigating these intricate regulations. Fill out our online form to request your free estimate!

Disclaimer

The information provided on this page is intended purely for educational purposes and should not be construed as legal advice. Every effort has been made to ensure the accuracy and completeness of the information up until the published date. However, laws related to fundraising registration are subject to change, and variations may occur between states. Furthermore, the interpretation and enforcement of these laws can often be complex, and the specifics of your situation can impact how the law applies.

Affinity Fundraising Registration is not a law firm and, as such, cannot provide legal opinions. For all specific legal questions or concerns, we strongly recommend consulting with a qualified attorney who is experienced in nonprofit law and compliance. Hiring a legal professional ensures that your organization is fully aware of its obligations under the law and can act accordingly to remain compliant.

By using this site, you acknowledge that Affinity Fundraising Registration holds no liability for any consequences, legal or otherwise, resulting from actions taken based on the information provided on this page.