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Functional Expense Allocation CalculatorProgram, Management and General, Fundraising

What do these figures come to once the work is shown?

Spread a shared cost pool across program services, management and general, and fundraising by percentage, add direct costs and get the Form 990 Part IX column totals.

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Your figures
Example figuresIllustrative only. Type over them with your own.
Program services total
$472,000
Form 990 Part IX, column (B)
Management and general total
$80,000
Fundraising total
$48,000
Drawn to one scale
Program services total$472,000
Management and general total$80,000
Fundraising total$48,000
Total functional expenses$600,000
Shared cost allocated to program services$72,000
Shared cost allocated to management and general$30,000
All results
MeasureResult
Program services total$472,000
Management and general total$80,000
Fundraising total$48,000
Total functional expenses$600,000
Shared cost allocated to program services$72,000
Shared cost allocated to management and general$30,000
Shared cost allocated to fundraising$18,000
Allocation percentages entered100.00%
Allocation checkPercentages add to 100 percent
How this was worked out
Work shownrecomputed as you type
Allocated share = shared cost pool x function percentage
Function total = direct costs of the function + allocated share
Total functional expenses = program + management and general + fundraising

Illustrative arithmetic on the figures you enter. Check the result against your firm's methodology before relying on it.

The formulas

  • Allocated share = shared cost pool x function percentage
  • Function total = direct costs of the function + allocated share
  • Total functional expenses = program + management and general + fundraising

How it works

Form 990 Part IX asks section 501(c)(3) and 501(c)(4) organizations to split every expense line across column (B) program services, column (C) management and general, and column (D) fundraising. If the accounting system does not allocate expenses, the instructions allow any reasonable method of allocation, as long as the amounts are accurate and the method is documented.

The IRS example: an employee who works on fundraising 40 percent of the time and program management 60 percent of the time has salary allocated 40 percent to fundraising and 60 percent to program services. The whole salary cannot go to programs just because most of the time was spent there. Use time records, square footage or another driver that fits each cost, and run this tool once per cost pool.

Illustrative figures only. Check the result against your firm's methodology before relying on it.

Common questions

Which costs belong in management and general?

The Form 990 instructions list board and committee meetings, general legal services, accounting, general liability insurance, office management, auditing, human resources and other centralized services, the annual report and investment management.

Can a cost tied to raising a grant go to programs?

Costs to secure a grant or contract to perform a service that meets the grantor's specific needs go in column (B). Costs to solicit grants that fund services to the general public go in column (D).

What about joint costs of a mailing with a program message?

Part IX line 26 discloses how joint costs of combined educational and fundraising campaigns were split, and its box is checked only if the organization followed SOP 98-2 (FASB ASC 958-720). Costs of describing the organization itself, its use of past gifts or its planned use of gifts are fundraising expenses in column (D).

Sources

Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.

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CalculatorProgram Expense Ratio Calculator for NonprofitsProgram services as a share of total functional expenses, with the management and general and fundraising shares, from Form 990 Part IX columns (B) to (D).CalculatorFundraising Efficiency Calculator: Cost to Raise a DollarFundraising expense per dollar of contributions, contributions raised per dollar spent and the net amount raised.CalculatorNonprofit Operating Reserve Calculator: Months of Expenses CoveredMonths of cash operating expenses that available reserves cover, and the gap to a target number of months.
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