How Stranded Funds Automation Works

When we cannot disburse a donation to the intended charity, the donation can become a stranded fund. Our process prioritizes delivering the donation to the originally selected organization before the donation enters Stranded Funds Automation (SFA).

For most hold reasons, donations that could not be disbursed enter a holding period. YourCause runs nightly checks during the holding period to look for indications that we can now disburse to the organization. For example, charities may regain standing with the IRS, update their address, or add a new payment method in our system.

The holding period length varies by hold type:

  • Stale Check: 240 days

  • Undeliverable check: 180 days

  • Charity Note Give Eligible, Charity is no longer active, and Charity Renewing Vetting: 90 days

  • ACH returns: 30 days

  • State Revoked Charity and Payee returned: 0 days, the donation immediately enters SFA

For stale checks, we also encourage the employee to contact the organization. We notify employees in the weekly digest email that they can contact their charity. In Action Required, we provide employees with a sample message. The message encourages nonprofits to deposit their stale check or join Blackbaud Verified Network to request a new payment.

If we are able to disburse a payment to the intended organization during the holding period, the donation never enters the Stranded Funds Automation process.

Redirecting Donations in SFA

When we can't disburse a donation during the holding period, the donation enters SFA for redirection.

How the donation gets redirected depends on the donor's state of residence, the type of donation, and the employer's settings:

  • Employee dollar donations from California donors: Donors who selected California as their state of residence can choose a new charity and redirect their donations. This complies with California Assembly Bill 488.

  • Employee dollar donations from donors outside California: These donations redirect automatically to the community's preferred alternate organization. This restriction keeps employee donations tax-deductible.

  • Company dollars: The resolution for these donations depends on the employer’s settings.

    • If the employer allows employees to select a new organization, donors can choose a new charity and redirect these donations.

    • If not enabled, these donations redirect automatically to the community's preferred alternate organization.

Tip: Employee dollar donations include payroll and credit card donations. Company dollars are employer-funded donations, such as incentives, matches, and Cause Cards.

If the employee can select a redirect charity and does not take action by the 30-day deadline, their donation is automatically redirected to the community's designated alternate organization.

For stranded funds tied to a recurring payroll pledge, we cancel the pledge when the donation enters SFA. For donors from California, selecting a redirect charity creates a new recurring payroll pledge to the new charity. The original pledge is still cancelled.

Note: We determine whether an employee donor is from California based on the location of residence the employee selects in the platform. Employees can manage their residence information from My Account.

Automatic Redirects

The following situations also trigger an automatic redirect of a stranded fund without input from the donor:

  • The donor does not select a redirect organization before the 30-day deadline.

  • The donor selects the Reissue to original organization option and the funds go stale again.

  • The donor is no longer an active employee.

Automatically redirected donations go to the employer's preferred alternate organization.