Some grantmakers require an IRS determination letter, while others fund projects through fiscal sponsors or accept applications from newer organizations. Grant eligibility is set by each funder and is separate from the IRS rules for forming or recognizing the nonprofit.

Nonprofits can be funded through donations, grants, program-service revenue, membership dues, sponsorships, and events; earning revenue is allowed, and the key question is how the activity relates to the exempt mission. Revenue from a regularly carried-on trade or business unrelated to that mission may be unrelated business income, and $1,000 or more of gross unrelated business income triggers a Form 990-T filing requirement. For each revenue source, record what the organization receives, what it promises in return, and how the activity connects to the mission, since grantmakers also set their own eligibility standards beyond IRS rules.

Requirements and government fees can change, so verify time-sensitive details with the responsible agency before filing.

How Beacon Nonprofit can help: Beacon can create the formal entity and, with BeaconComplete, support the EIN, bylaws, and 501(c)(3) application records that many grantmakers request during due diligence. Beacon does not write grant proposals, select funders, certify eligibility for a specific grant, or guarantee an award; each funder sets its own requirements. Beacon's role is administrative formation and filing support: government agencies control approval, processing times, and legal or tax determinations, and specialized operational matters may require a qualified professional outside Beacon's service scope. Depending on the selected package, the Beacon records available to the organization can include the approved state formation documents and, with BeaconComplete, EIN assistance, corporate bylaws, registered agent service, and the 501(c)(3) application materials prepared through the service.