The Complexities of International Giving
There are many complex and challenging U.S. government regulations surrounding international giving. The International Community Foundation ensures that each and every charitable gift made on behalf of donors is in full compliance with the law. The foundation works diligently to promote full compliance with:
- The Internal Revenue Code (IRC) —
The IRC allows the giving of international grants under the condition that the foundation either certify foreign charities as 501(c)(3) equivalent organizations or the foundation employs a process called "expenditure responsibility," which requires a pre-grant inquiry, grant agreement, separate accounting for charitable funds, and financial tracking and reporting.
- Pension Protection Act of 2006—
Classifies permissible international giving through donor advised funds under certain conditions.
- USA Patriot Act of 2001 (reauthorized in 2005) --
This law increases, among other things, existing criminal penalties for knowingly or intentionally providing material support or resources for terrorism through international grantmaking.
- Executive Order 13224—
This order prohibits transactions with any charitable organization deemed by the Executive Branch and other U.S. agencies to be associated with terrorism. This executive order freezes all assets controlled by or in the possession of any charity or other entity that supports terrorists. To ensure full compliance with the law, the International Community Foundation regularly checks the names of nonprofit staff and directors against lists of prohibited persons.
- U.S. Department of the Treasury: Anti-Terrorist Financing Guidelines—
These "Voluntary Best Practices for U.S.-Based Charities" provide guidance regarding compliance with the USA Patriot Act and Executive Order 13224. The guidelines describe how international funders should make grants and transfer funds to non-U.S. organizations. The International Community Foundation procedures, from approving charities through grant administration, follow these best practices recommended by the U.S. Department of the Treasury.