Accounting/tax questions about doing a good deed?

The small company that I work for has several community service projects coming up. The first is raising at least $500 for us to sponsor a dog with The Coalition to Unchain Dogs, a non-profit that educates pet owners and builds fences for needy families that keep a pet on a chain. When we raise the money, we’ll volunteer as a team and help build the fence, too. I’ve committed the clinic to purchasing t-shirts to sell, as well as commemorative bracelets (the idea is that the clinic will fund half of the sponsoring cost).

The second project is much larger in scope. We are fronting an effort to get the entire area veterinary community involved in raising funds to provide animal-specific oxygen masks for every emergency response truck (126) in the entire county (they are not standard equipment, and would help to save pet lives in the event of house fires). The cost will be nearly $8000, and we hope to get as many vet hospitals in the area as possible to display the fundraising materials that we will provide.

So here’s my question. How do we handle the money so that the IRS is happy, and we aren’t required to claim the donations as income? The process of applying for and receiving 501©3 status is much more involved that I’d like to get. Since the Coalition is a non-profit, I figure I can probably work with them to set up some sort of page to track our efforts with the money going directly to them (I hope!). The fire department is a bigger problem. Can I have them set up a Paypal account? If it’s theirs, can I track how much money has been raised? Is this going to become incredibly complicated??