What’s a fiscal agent? Excellent question! Below, we’ve compiled the most frequently asked questions about fiscal agents and provided some answers.
A fiscal agent is an organization that agrees to accept and be responsible for grant funds on your behalf. Before listing a fiscal agent on your grant application, check with your school leadership team or administrator to verify if the fiscal agent should be your school, school district, school board, institution’s grants administration or development office (in the case of higher ed), or local union. Grant awards will be delayed if an inaccurate fiscal agent is provided in the application. Click here more information about fiscal agents.
Unless you designate a fiscal agent, The NEA Foundation will make the grant payable directly to the lead applicant as an individual. In this case, the IRS may consider the grant personal income and therefore taxable.
The Foundation, by law, must issue you a 1099 (reporting form for miscellaneous income) at the end of the year. A copy of this form also goes directly to the IRS.
As an individual, you’ll probably have to pay taxes on your grant. Fiscal agents, on the other hand, are usually non-profit organizations that can accept the funds without tax liability.
The NEA Foundation is not qualified to give tax advice, and makes no recommendations about whether or not you should designate a fiscal agent; the choice is up to each applicant. We suggest you consult with a tax advisor or accountant if you are unsure.
This varies. Generally speaking, your school, school district, school board, institution’s grants administration or development office, or local union may serve as a fiscal agent.
This depends mostly on the administrative structure of your school district, college, or university. If you aren’t sure of the procedure, talk to your principal, someone from the central office, your dean, or someone from your institution’s sponsored research office. You may also want to speak to colleagues who have previously received grants to find out about their experience.
A representative of the organization you designate as fiscal agent must sign the applicant data sheet. This person must be authorized to represent and act in the name of the organization, specifically in the receipt, disbursement, and oversight of grant monies.
In addition, you should verify that the address of the fiscal agent on the form is the correct and complete mailing address to which a check may be sent.
The fiscal agent is responsible for receiving and safeguarding your grant funds. Legally, the fiscal agent is obligated to:
- maintain its own records of disbursements related to the grant
- keep receipts for at least three years following receipt of the grant
- make financial records available to The NEA Foundation upon request
- disburse funds in accordance with the purpose of the grant application
- disburse funds solely at the direction of the grantee
As a grantee, your job is to follow up with the fiscal agent to make sure you receive your funds when you need them.
If a check issued by The NEA Foundation (either to an individual or an organization) does not arrive within a reasonable period after award notification and appears to have been misplaced or lost in transit, you should contact the Foundation. However, you’ll have to wait at least 60 days before the NEA Foundation can stop payment on the original check and issue a new one.
There may be some disadvantages to designating a fiscal agent. For example:
- You will not have direct control over the funds, but will need to deal with one or more intermediaries at the fiscal agency when you want to use your grant funds.
- Since most fiscal agents are large, complex organizations, there could be delays in accessing funds.
- Changes in personnel at the fiscal agency could result in delays or miscommunication.
It will be your responsibility to identify and follow up with the appropriate representative of the fiscal agent organization to ensure that you receive your grant in a timely fashion.
If you wish to have a fiscal agent accept the grant in the event that your proposal is approved, you must designate the agent at the time of your original application. The NEA Foundation will not consider requests to appoint a fiscal agent after an award has been made.
Whether or not you designate a fiscal agent, all grantees are personally responsible for submitting a complete and accurate account of all grant expenditures by the deadline specified in your award letter. If you have a fiscal agent, you should arrange to obtain an accounting of expenditures for the final report several weeks prior to its due date.
DISCLAIMER: The above should be considered general information rather than specific tax advice. We recommend you consult a tax specialist or accountant with any questions about your situation.