Some Nonprofits Can't Touch Their Money

There are ways to get around the law. In creating an endowment, nonprofits can enter into an agreement with the donor that allows for the use of principal in emergencies. They can also ask the donor to change the endowment's terms retroactively, which requires a trip to court if the donor has died.

Dale said that while some donors may have intended for the principal to remain intact, others may be asking "Was it my intent that the students I want to help won't get any help?" Dale said that most donors, if asked, would probably agree to loosen the strings attached to their gifts.