Questions our Hosted Groups may have
Unfortunately, these services do not currently allow nonprofit accounts.
If your bank account accepts direct deposit, then you need to go to “More Actions” on the Expense page, and click “Edit.” Then, under “Payout method” go to + New Bank Account, and then input all of your bank account info, including address etc. Then you’ll need to go to “Next” then “Save,” and have it re-approved by the collective admin. If you don’t have a bank account to use for receiving expenses, there are some services that will give you access to direct deposits, such as Venmo and Cash App. These services will generate bank account details you can then input on Open Collective as a bank transfer in the expense.
Some groups who started out all-volunteer have hesitations when it comes to starting to pay people—especially if their mission is about countering negative impacts of economic exploitation in our capitalist society, which is understandable. It's true that beginning to pay people can change the dynamics, and bring up complicated questions about who gets paid and how much.
However, we encourage Collectives to take these questions and concerns on and have frank conversations as a group about them, because that's a really healthy step to take. Regardless of the conclusion, important thinking and communication will happen. It is possible to pay people in ethical, transparent, accountable, and mindful ways.
OCF's mission is about the sustainability of positive impact Collectives. We help groups raise money so they can be resourced to grow and thrive. Often, that is about paying for people's time. While Collectives need to be mindful with their financial resources, human capacity is a resource too, and burning people out is not the way.
OCF won't tell you what to do—it's up to Collectives to make these decisions. But we encourage you to think about the long-term health of your Collective and the well-being and development of the humans who make it all possible.
You can pay people casually as contractors through invoice expenses on your Collective, or if they'll be working on a regular basis, employ them part or full time. If workers would like to benefit from paid time off and health insurance, we recommend that you reach out to us about employment through OCF.
Contractors and vendors should be paid in a timely manner, with a detailed invoice showing when they provided services and at what rate. Expenses without these details may not be approved by the OCF team for payment.
Invoices are to pay people for goods and services that further the Collective's mission. This includes tangible items (e.g., a food distribution project might pay an invoice from a food supply company), people's time (hours worked by contractors doing work for the Collective), or services (e.g., paying a designer to make you a logo, renting a venue for an event). Invoices must include a specific accounting of the goods or services being paid for, such as hours, tasks, and items.
We cannot pay for people's expenses in advance via invoices, such as a request for $100 for a phone bill or help with rent. We can reimburse those expenses if the payee can provide a valid receipt, but if they aren't able to pay upfront and get reimbursed with a receipt, you should instead support them through making a grant or cash assistance.
Open Collective Foundation must collect tax forms for any individual who invoices (this does not apply to reimbursements or payroll) over $600 in year. Those individuals will be automatically issued a 1099. Here's a good explanation of how W-9s work for independent contractors, and there's more info on what a 1099 is here.
When you submit an expense that puts you over the $600 threshold, you will be sent an email with a link to complete your tax form online. This email will come from Dropbox Forms, the system we use to handle the forms.
Expenses will not be paid out to you until you submit the tax form.
If you don’t meet the $600 threshold, simply report your earnings as miscellaneous self-employment income when you file your taxes as described above.
Please note: If you are paid via Paypal, OCF will not issue you a 1099 because Paypal is responsible for that. So you will not be asked for a tax form if paid via Paypal. However, Paypal only sends out 1099s when >$20,000 is invoiced. This means you will not get a 1099 from Paypal or OCF if you receive less than $20,000 total from Paypal.
We do need your real name as your legal name, because we are bound by IRS regulations and need to be able to ensure funds are being used appropriately. This private legal name will only be visible to admins.
Details such as attachments, comments, the private note section, and the payout method information are only visible to the submitter of the request, the collective admin, and the fiscal host admin who processes the actual payment. Confidential details can also be included in those areas to ensure privacy.
As a 501(c)(3) we cannot give out lump sums first and get receipts later. This is because, with the IRS regulations for a charitable nonprofit, we have to be able to track all funds that come in and go out of our accounts.
For large expenses that you cannot pay out-of-pocket, you can also have your vendors and service providers submit their invoices directly via your Collective's page, or you can use the "invite expense" option, where you fill in the details and they receive an email and then just need to confirm. So vendors can invoice OCF through your page to get paid, and then we pay them directly.
Since this type of ownership could get quite complicated for us to manage, unfortunately, we do not have the administrative capability to handle these sorts of major assets. For other complicated transactions, it's always best to reach out in advance and talk it through with us.
If you want to enter into an agreement with someone else, such as a contract with a vendor, landlord, or providing a specific service to a sponsor, you need to get our permission, because legally that agreement is with the Foundation as the legal entity. This applies to employing people as well. If you ask us to sign a contract for you, you agree to fulfill the terms of that contract.
We primarily reimburse personal automobile costs incurred while doing Collective work via our Mileage Reimbursement Policy. Thus, we cannot reimburse for personal automobile expenses such as repairs, gas fill-ups, insurance, or registration. These are supposed to be accounted for within the mileage reimbursement rate, which is set by the IRS on an annual basis.
If you rent or hire a car for Collective charitable purposes, you cannot submit for mileage reimbursement, but you can submit gasoline fill-up receipts and other related expenses, alongside the cost of the rental. If you plan to enter into a contracted longer-term rental or lease, you must involve us in the contract process. (We cannot "rent" a volunteer's personal vehicle.)
We reimburse bicycle travel at the same rate as automobile travel, using the same process.
If a bicycle is used exclusively for Collective charitable purposes, we can reimburse repairs and other costs.
Individuals driving an automobile for Collective purposes must have valid automobile insurance.
Yes, hosted collectives can do this. Please be sure to talk to us about the specifics of the payment processes in your local community, and make sure that our expense processes (such as using a virtual card) can fit your needs, especially in terms of timing.
Donations to individuals should fit within an existing Grantmaking or Cash Assistance program. Collectives should not make one-off donations to individuals outside of one of these programs, but Collectives are encouraged to consider creating a Grantmaking or Cash Assistance program to support people undergoing hardship in their communities.
Collectives may only make donations through GoFundMe or other similar platforms to other 501(c)(3) public charities. For donations to such charities over $5,000, OCF staff will need to review the organization's IRS Determination Letter. (Please request it from the 501(c)(3) recipient and send it to us at [email protected].)
OCF cannot reimburse purchases made before OCF approved a Collective's application.
On a case-by-case basis, depending on the nature of the work, OCF might be able to pay invoice expenses for services provided during the 30 days preceding approval by OCF. The invoice expense must be submitted and approved within the first 30 days after a Collective joins OCF.