Donations that a donor has designated for a specific purpose or program rather than general use.
Restricted funds are contributions that come with donor-imposed limits on how the money may be used. A donor might restrict a gift to a particular program, project, or time period. Nonprofits are legally and ethically obligated to honor these restrictions.
Restrictions are commonly described as temporarily restricted (the limit lifts once a purpose is met or time passes) or permanently restricted (such as endowment principal that must be preserved). The opposite is unrestricted funds, which the organization may use wherever the need is greatest.
Tracking restricted versus unrestricted dollars accurately is critical for compliance and reporting, and it is one reason nonprofits maintain detailed gift records in a dedicated nonprofit CRM and accounting system.
See it in Kindly
Donations a nonprofit can use for any legitimate purpose, with no donor-imposed limits.
A permanent fund whose principal is invested and preserved, with investment income used to support the mission.
Funding awarded to a nonprofit by a foundation, government, or corporation for a specific purpose.
The annual information return most tax-exempt organizations file with the IRS to report finances and operations.
Manage donors, volunteers, members, and events together in one nonprofit platform, for one predictable subscription with no cut taken from donations.
