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Giving Globally Part 2: Expenditure Responsibility

Imagine a newly formed nonprofit is organized to help end poverty internationally. The foundation’s board aims to accomplish its charitable purpose in many different ways, including funding local organizations in foreign countries. The grant-related tax concept of “expenditure responsibility” is vital if the new organization is a private nonoperating foundation, and it is also quite helpful for other Section 501(c)(3) organizations.

Giving Globally: Equivalency Determinations

International philanthropy is heartily encouraged under US tax laws, which generously allow section 501(c)(3) nonprofits to financially support other organizations and projects operating entirely outside the United States. But foreign grantmaking rules for 501(c)(3) organizations differ depending on whether an organization is a public charity, a private foundation, or a sponsoring organization for donor advised funds (DAFs). Nonprofit leaders should therefore understand not only what rules apply, but also available compliance options.

OFAC Releases New Guidance on International Sanctions Compliance

Many U.S. nonprofits provide vitally needed humanitarian assistance internationally, particularly against the backdrop of pressing medical needs, refugee crises in war-affected countries, and extensive poverty.  In connection with any foreign grantmaking, foreign payments, or other overseas operations, nonprofits need to be mindful of their obligations to comply with United States sanctions programs, which are often more extensive and applicable than many nonprofit organizations understand.

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