Government Grants for Nonprofits - Great Funding Options for 2025!

Nonprofits face an upward battle when it comes to financing their project goals and programs or even just paying their employees. Channels like donations, fundraising events, volunteership, all offer some relief, however short-term. Securing government grants therefore can provide longer term financial stability for nonprofits to accomplish their mission. However, navigating the government grants universe can be a challenging process. Needless to say, know-how and preparation are a must. Here, we will delve into the ins and outs of government grant financing.

Government grants for charitable organizations can range from a few thousand dollars to hundreds of thousands of dollars or even millions of dollars over several years. They can be sought at the Federal level, State and Local level and can be used to finance equipment, building and maintenance, and other operational or program costs such as staff and employee salaries.

In addition, there are several benefits to government grants for charitable organizations. Government grants provide credibility to the recipient, are widely available, have no limits and unlike loans, they do not need to be repaid. Making sure you are eligible and choosing the right type of grant, that aligns with your organization’s mission and goals is important.

Understanding Government Grants for your Nonprofit

Government funding for nonprofits are essentially a form of financial awards or money that are given to various organizations and even individuals. Unlike a loan, grants do not need to be paid back. These government awards or are for a wide range of initiatives and programs, from education-related initiatives to environmental projects and based on several criteria and terms of reference. To become a recipient or beneficiary of these awards an applicant must not only meet all the criteria but often include in depth proposals.

Most government grant applications require the applicants to submit not only all the proper requested documentation but also a detailed proposal outlining a plan of action for how the funds will be used, along with measurable deliverables or metrics to gauge the impact and success of the grants’ use, but also in some cases even provide a financial statement or audit of the organization’s financial history and organizational structure. Applying to government grants can be a very tedious and complicated process so make sure you start early enough and make the deadline. The earlier the better. government agencies that award grants will certainly publish their full list of available grants on their web

Nonprofits can research and apply to various government grants through many ways, on various agencies and online .gov sites and even through local libraries and other organizations. Some, however, will require a nonprofit to apply directly by filling out and submitting their form along with all required documentation.

It is useful to keep in mind that government grants can also have restrictions or conditions on the grant awarded. An example of a restriction could be when a grant cannot be used to pay staff salaries, or marketing costs, among others. Additionally, some grants can even be time-constrained and although most government grants may be available all year round, some may be more specific and only offered at certain times of the year.

There are 3 types of Government grants that nonprofits can apply to: Federal, State and Local.

Federal Government Grants: these are awarded to nonprofits directly by Congress. They have an annual deadline of Oct 1^st.  The primary channel to research and apply for available federal grants is GRANTS.GOV. Secondary government sites include  SAM.gov and the Federal Register.

 State Government Grants: the availability of these awards varies based on your State. Typically, States will update their grant portal on their website. However, in some cases, you would need to subscribe or go through a third party to research and find State grants. Perhaps, the most direct way to find out about state grants is to contact directly the offices of elected State officials to direct you to potential state grants.

Local Government Grants: these types of grants generally are easier to win as there is less competition and they are harder to find. Local grants can be found however through your Municipal office or Mayor’s office or directly through your local county office or by contacting the County Commissioner or City Council.  Local grants can be found through GRANTS.GOV site as well as GovGrantsHelp.com.

Types of Government Grants for Nonprofits

To help you identify what type of grant is best for your nonprofit or charitable organization here are the 4 main types of grants to choose from: Competitive, Continuation, Pass-through, and Formula grants. Each one is unique, and the best type is highly dependent on the goals and/or funding needs of the non-profit.

Competitive Grants: are grants that are awarded through a highly competitive and open application process. This process is based exclusively on the submission of and evaluation of the proposal for the project or program. Competitive grants are the most popular method of awarding grants. Their popularity is primarily because these types of grants allow grantors to select the most promising projects and organizations to finance through grant awards.  These types of grants are generally awarded by government agencies but also private foundations, and even corporations and other non-profit organizations.

To be considered you must submit a proposal to be considered. Once submitted they are then carefully evaluated based on the criteria of the organization in question. The criteria can include touchpoints such as whether it is a program match, or the shared values, basic funding needs, the degree of impact on a given community or beneficiary group and several others. 

Most competitive grants will assign a score to each proposal based on this predetermined criterion. To ensure that all funds go to initiatives with the greatest potential impact the award is granted to the proposals who score the highest.

Continuation Grants: these grants are specifically for nonprofits with a track record as they offer funding for existing ongoing successful projects and programs. These grants are very useful for mid- and long-term projects as they provide the funding for an organization to renew a previously awarded grant for the next incoming cycle.

Pass-Through Grants: Pass-through grants are also known as “intermediary grants”. They provide funding to a nonprofit intermediary who will then redistribute to other organizations deemed eligible. An example of this is a federal or state agency that distributes grants to a local government or organization, which will then allocate those funds to nonprofit and charitable organizations. The biggest recipients of these grants are typically nonprofits and organizations that have established solid relationships with local governments, their agencies and similar networks.

Formula Grants: these grants are allocated based on an already predetermined formula or criteria. Formula grants are non-competitive, so the funds are distributed to an organization if they meet the criteria. Although the amount awarded can vary. All applicants who meet the criteria will receive funding. Formula grants are typically administered by federal, state, and local government and are widely used across the public sector such as Education, Public Health, Transportation and Housing sectors although there are typically no grants for buying land for a nonprofit. Another layer of grant awards is whether they are awarded for general purpose or project specific. This distinction is very important when choosing whether to apply for a grant or not.

Project-specific grants: Grantors tend to prefer these types of grants because they can easily measure the impact of their financial support. Project-specific grants are therefore generally tied to project outcomes and results and require a specific budget and budget allocation to which the nonprofit must abide by. In that sense, these types of grants can therefore feel limiting.

General-purpose grants: these types of grants can offer a recipient much more flexibility as they support overall activities of a nonprofit organization. This can include costs such as operating expenses, overhead and can sometimes include capital purchases. In this sense, general-purpose grants offer non-profits the flexibility to define their own funding priorities and where it is most needed and most effective. However, the back draw is that most Grantors are weary of general-purpose grants simply because their impact cannot be directly measured.

How to Find and Apply for Federal Grants

Finding and applying for federal grants can be exhausting and a time-consuming process.  For nonprofits to get the most of their time and resources it is important to follow the appropriate steps. It is important to carefully and thoroughly complete all the application’s requirements and to provide the correct documentation where asked. Here are some basic steps a non-profit can follow to increase the chances of a successful submission and grant win.

1.Research and choose the right Grant that fits your organization’s goals and mission.

The first basic step in the application process is to locate the right grant or grants for which you want to apply. Make a list. You can use Google to search for potential grants from your city or local area. However, for Federal grants it is ideal to go through the Catalog of Federal Domestic Assistance and Grants.gov.

2.Review of Grant Requirements and Eligibility.

Once you have found the right grant or grants your organization wishes to apply to, the next step is to take a detailed look and review those grant opportunities. Here your focus is to learn about their terms of reference, requirements, and to most importantly determine whether you are eligible to apply. This is a very crucial step to make sure valuable time and resources are not wasted.

3.Write and Develop Each Grant Application Separately

No two Grants are the same. Therefore, no two Grant applications will be developed the same. Each Grant will require a specific grant application process tailored to each individual Grant. Follow each Grant requirement closely. Most charitable organizations hire a professional Grant Writer to develop these documents. In most cases, grant applications will consist of written sections as well as the submission of various financial and organizational documents. No section should be left undone as this will hurt your chances of being awarded the grant.

4.Final Review and Submission

Before hitting that “submit” button on your federal grant application it is best practice and highly recommended to review your entire application one final time. Sometimes a second and third time is helpful, too. Always making sure that you have met all the requirements, answered all the questions, provided all the information and attached all the necessary documentation without errors. Once the application has been reviewed, and all if any errors corrected, it is time to finally submit your application.

Some of the most common over-arching mistakes in grant writing boils down to two general themes: misunderstanding of the grant requirements and-or criteria and simply overlooking critical details in the grant guidelines. Not only can these lead to disqualification but they can lead to a loss of credibility in your nonprofits or organization for future applications.

To help you avoid these mistakes here is a quick guideline for you to keep in mind when reviewing and writing your application for Federal Grants

Inadequate Project Description and Goals: avoid vague and overly ambitious project descriptions that can leave the reader asking questions or confused. Goals need to be realistic and clearly outlined. Objectives and methodology should be clearly described to show a strong understanding of potential outcomes.

Weak budget and financial plan: A robust financial plan and a clear budget are core components of any grant application. How will the funds be used? It is best to avoid unrealistic cost estimates and vague line items. Expenses also need to be clearly justified. Poorly constructed budgets and financial plans only sow doubts in the organization’s ability to manage and execute the funds and the project efficiently and effectively.  

Insufficient supporting documentation: documentation plays a key role in reinforcing your stated goals, objectives and outcomes, but also in reinforcing your organizational capacity for seeing through the implementation and monitoring and reporting of the entirety of the project or program. Lack of documentation can lead to automatic rejection.

Failure to address the grant maker’s priorities and objectives: each grant maker has different and very specific areas of concern and priorities for their funding efforts. Aligning with and addressing a grantor's concern would further ensure your application is taken into consideration.
 
Finally missing deadlines: Keep in mind that the grant applications have hard deadlines. Even an hour late makes your application dead upon arrival. For best practices, it is best submitted early. The earlier the better.

Eligibility Criteria for Government Grants

Understanding eligibility criteria for nonprofit Grants is another important aspect of grant writing. As already mentioned, before you begin the application process to any grant it is crucial to first determine your eligibility to avoid wasting valuable time and resources applying if you cannot even receive the award in the first place. Each government grantor has its own criteria for government funding. When searching for any government grants, you must thoroughly read the grant’s specific instructions and understand all federal grant’s unique qualifications.

There are, however, some common eligibility factors that have appeared across the grant application process. One common and crucial factor is compliance with the Internal Revenue Service. This key requirement refers to the tax exemption status awarded by the IRS to the various charitable organizations and nonprofits.

With a few exceptions most grant-making entities such as Federal and State agencies require that applicants be registered as 501(c)(3) organization or possess the equivalent of a nonprofit status. Having a 501(c)(3) status signals to the Grantor that any contributions made are indeed tax deductible as designated by the IRS. Once a 501(c)(3) status is secure then the organization can move forward with verifying eligibility based on more grant specific guidelines like size, goals, and nonprofit type. In addition to a tax exempt 501(c)(3) status, a 990 Form from the IRS is also required to be filed annually to demonstrate financial transparency and compliance.

Federal Grantors may also be more inclined to support organizations that have an established track record of implementing a program effectively as well as solid financial management practices. This is important for some Grantors as it demonstrates financial stability and sustainability.

Having the same overlapping missions and goals or funder priorities may also be a criterion for some government Grantors. This is known as “aligning with the funding priorities of the grant-making organization”. Likewise, requiring a clear governance structure in the organization may also be a criterion for some Grantors, more so, when it comes to larger financial awards. For example, some Grantors may require the presence of a Board of Directors as part of the nonprofit to be considered eligible. Other criteria may include target beneficiaries, geographical area or a specific programmatic focus like education, homelessness, nutrition, etc.

There are also several Federal and State requirements that need to be met.  State and Local Grant eligibility requirements are specific to each State so it will depend on where you are applying to and from.  Usually, they will include registering with a state or grant system and the completion and submission of state specific forms and documentation.

At the Federal level, grant eligibility will require nonprofits and other charitable organization to register with the System Award Management (SAM) at sam.gov to be considered eligible for federal grants. In addition, nonprofit organizations need to obtain a Unique Entity ID through SAM and follow the Uniform Guidelines for grant compliance, audits and cost principles.

Managing Government Nonprofit Grants

Once you have been awarded a grant, it is time to start using that funding. Managing the grant award well is extremely important for any organization’s standing, reputation and future grant applications efforts. Bad management can and often does lead to a high future rejection rate. The most important thing to remember is that good management of a grant award is more than just spending all the funds. It is about transparency, efficiency, accountability and success as measured by the impact of the funds on your goals, objectives and overall mission.

The following is a guideline for non-profits to manage a grant as smoothly as possible. Understanding the grant agreement is paramount and the first thing you should check off. For this it is important to read the grant terms and conditions in order to understand components such as duration of the award, reporting requirements and very importantly what you can and can’t use the funds for. That is, understanding and abiding by the limits or scope of the fund disbursement agreement.

Likewise, setting up and using a grant management system is key for a nonprofits ability to organize, have oversight and be able to track the grant properly. Software tools for tracking funds and budget management as well as organizational needs are always beneficial to implement.
When it comes to budget management efforts, it is crucial to set up the budget carefully and stick to it. Be very careful not to overspend or underspend funds, avoid at all costs misallocating and misuse of funds, as these can seriously put in jeopardy your relationship with the Grantor. The budget must align with the grant proposal description, and objectives or goals.

Detailed record keeping and documentation of all expenses, costs and allocation of funds will further help with any grant compliance issues and will also provide a good basis for audits

Next, it is always important to meet all the reporting deadlines. Missing a reporting deadline can hamper future disbursements of the grant funds, tarnish your organization’s reputation and sow doubt in your organization’s ability to properly manage grant funds and implement projects efficiently and in a timely fashion. Financial reports and programmatic updates should always be submitted on time.

To avoid pitfalls like these it would be extremely useful to develop a compliance check list, setting calendar reminders and using project management tools and software for nonprofit and charitable organizations can come in handy for meeting compliance requirements including financial reporting.

Financial reporting and compliance are extremely important, as it directly reflects an organization's ability to manage the grant effectively. Following to the “T” the terms and conditions of the grant is the only way to ensure successful compliance. Failing to comply can result in external audits, penalties, soured relationship and damaged reputation and even call back of remaining funds and in some cases, even repayment of funds.

A Financial report is usually provided to the Grantor at established agreed upon periodic intervals, depending on the either project benchmarks or disbursements of funds. The report details and describes line items such as remaining funds, if any, expenditures, what those expenditures were for and whether they were used as described in the Gran application, what goals and objectives were impacted.

For a guideline on Financial Reporting you can lean on the rules set by the Uniform Guidance document (2 CFR 200) for “uniform administrative requirements, cost principles, and audit requirements for federal awards”

For success in this area, organizations should implement a robust financial system, properly train staff to implement accounting best practices and conduct regular internal reviews and oversight to produce accurate reporting and adherence.

Case Studies of Successful Government Grant Recipients

In the fiscal year 2024, the Federal government through it’s 19 agencies awarded $14 billion dollars of grant awards to over 8,100 projects across the United States. A significant portion of these awards were given to nonprofit and charitable organizations. All sectors were included to support programs that address all kinds of societal needs such as education, environment, energy, health, and more. Naturally, for newer nonprofits on the scene, it is always beneficial to take some time and review what successful organizations have done to secure government grants to gain valuable insight and lessons learned from these examples.

Examples of Nonprofits that have successfully secured Federal Grants:

1.Boys and Girls Clubs of America

Through Federal support government agencies such as Department of Education, the Boys and Girls Clubs of America have successfully implemented across the United States various after school programs and youth development initiatives with the aim at reducing delinquency among underserved public-school youths. They have been extremely successful at securing government financial assistance from both the Department of Justice and Office of Juvenile Justice and Delinquency Prevention. Winning these Grants has been viral to the organization’s expansion and strengthening across thousands of communities nationwide.

2. Habitat for Humanity

Habitat for Humanity is focused on providing affordable housing to underserved areas and at-risk communities. Through federal grants from agencies and Grantors such as US Department of Housing and Urban Development, Community Development Block Grants and HOME Investment Partnerships Program, Habitat for Humanity managed to work towards its mission and goals.

3. American Red Cross – Disaster Relief and Emergency Services

Another great example of a successful nonprofit securing federal government grants is the American Red Cross. The American Red Cross has received financial assistance from the Federal Emergency Management Agency to provide disaster relief efforts such as temporary shelters, medical and food assistance during natural disasters and other similar crisis. This type of massive effort from a nonprofit could have only succeeded with the aid of government agencies.

To drastically increase the chances of winning and securing a federal grant or government assistance is to follow best practices and the general rules of grant writing. The most successful organizations have almost perfected the art of grant writing and the application process. Even if the grant is not awarded, the best organizations take it as an opportunity to learn, refine, and improve. It is very important to develop and then follow an eligibility checklist, as well as a compliance checklist, both of which can and often do improve the chances of obtaining government grants.

Successful applicants always begin by thoroughly researching grants that clearly align with their own goals and stated mission.  Based on this overlap, successful applicants can then develop a compelling proposal that includes a needs statement, accurate data and a demonstrable urgency to address the stated problem. Defining measurable, clear and realistic objectives and outcomes is another important component of the gran application.  As is a budget that reflects realistic spending and accurate numbers and an organizational capacity to carry them out.

Furthermore, successful applicants are able to leverage they track record and reputation, whether it is strong leadership, accountability, or proven positive impact on prior projects and financial awards. Finally, successful gran recipients also display a strong capacity and forthcoming in collaborative efforts to address the issue or need. Very importantly, successful nonprofits tend to build strong partnerships at all levels of the parties involved. From government agencies and local institutions to community leaders, to stakeholders and even with other charitable organizations that go a long way to signaling to Grantors of the applicant’s worthiness of receiving and being awarded federal and state grants.

Maximizing Your Chances of Securing Government Grants

To Recap then, recall that Government funding for nonprofits through grants is essentially a form of financial that do not need to be paid back. There are 3 types of Government grants that nonprofits can apply to: Federal, State and Local that are awarded to nonprofits.  The primary channel to research and apply for available federal grants is GRANTS.GOV. There are the 4 main types of grants to choose from: Competitive, Continuation, Pass-through, and Formula grants. Each one is unique, and the best type is highly dependent on the goals and/or funding needs of the non-profit.

The best and most successful strategies for winning government grants start with thorough research of the various grants available, picking the right kind of grant and making sure that your objectives align with those of the Grantor. It is useful to develop an eligibility check list.  When developing and writing the grant, it is paramount that your objectives and goals are clearly stated and defined. Once awarded, remember to construct a compliance check list to make sure your use of the funds and reporting is to the satisfaction of the Grantor. Building strong relationships along with demonstrating a good track record is helpful for future grant writing efforts.

FAQ's for Government Funding 

Where can I find government grants that align with my nonprofit’s mission?

Most of the time, you simply must research and read thoroughly each Grant’s term and conditions. In some cases, some grantors can cover multiple sectors. There are a few platforms and databases an organization can use to find government grants aligned with their mission like Grants.gov and SAM.gov. However, there are also specialized government agencies that nonprofit organizations in the same or similar sectors can go right off the bat. For example, Department of Education, Environmental Protection Agency, Department of Health and Human Services, Department of Housing and Urban Development, etc.

How long does it take to receive government grant funding after approval?

The time it takes to receive an approved government grant can vary depending on the specific agency processes, the type of grant and the program, any additional paperwork and if there is a disbursement calendar of the Grantor. In general, it can take weeks or even months to receive the award.

Are there government grants available for specific nonprofit sectors like education or healthcare?

Yes. There are grants available for pretty much any sector. The Education and Healthcare sectors are two of the biggest recipient sectors for federal, state and local grants.

Can my nonprofit apply for multiple government grants at the same time?

Yes, you can. All nonprofits can apply to multiple government grants simultaneously as long as you meet the eligibility criteria, and your mission goals align with the Grantors. Make sure your nonprofit has the capacity to apply and manage several grants at the same time and it's possible to also apply for private grants like an Apple grant as well.

How does my nonprofit maintain tax-exempt status while receiving government grants?

To maintain tax-exempt status while receiving government grants, a nonprofit must simply continue to comply with all the requirements set by the IRS including filing and maintaining the 501(c)(3) and 990 Form on an annual basis.