FISCAL SPONSORSHIP

A Way to Support Israeli and Palestinian Peace Builders

What is the role of a fiscal sponsor?

The role of a fiscal sponsor typically includes the management and administration of charitable contributions on behalf of the sponsored organization.  

It is common and acceptable for the fiscal sponsor to charge an administrative fee for services.  

Using a fiscal sponsor satisfies IRS requirements as long as the fiscal sponsor maintains the right to decide, at its own discretion, how it will use contributions.  

Fiscal sponsorship provides a pathway for organizations without tax-exempt status in the US to raise money in the US

The fiscal sponsor relationship benefits organizations or programs that are not tax-exempt by providing a flow-through pathway for money that the organization may not otherwise be in a position to receive. 

Fiscal sponsorship is often used by nonprofits that want to raise money from US donors even though they are not recognized as a tax-exempt entity by the Internal Revenue Service (IRS). 

Using a fiscal sponsor enables a program or organization that does not itself qualify as tax-exempt in the US to attract US donor funding for its operations.  

This benefits US donors because when these funds are donor directed through the fiscal sponsor, they are tax-deductible to the donors. 

  • Donors are able to claim a tax deduction only if they donate to an organization that is recognized by the IRS as tax-exempt pursuant to IRS Code Section 501(c)(3). See IRS Publication 557. 
  • Additionally, the guidelines of most private foundations explicitly require grantees to be recognized as tax-exempt by the IRS. Consequently, groups that are not formally recognized by the IRS as tax-exempt are generally not eligible for grants from private foundations. 
  • Some organizations/programs remain in a fiscal sponsorship relationship for a long time, deciding that this structure relieves them of the cost and responsibilities of creating a new entity that satisfies IRS Code Section 501(c)(3). 

Can MEPDN help our organization raise money in the US?

MEPDN does not help organizations actually raise money in the US. 

The type of fiscal sponsorship we offer pertains to the collection, administration and distribution of money your organization can solicit or raise in the US through your own relationships and efforts. 

Here's how MEPDN’s Fiscal Sponsorship can help your organization?

If you are a non-profit organization registered outside the US, MEPDN can help you legally collect money from US donors.

Your fiscal sponsorship relationship with MEPDN allows us to collect donations directed to your organization on your behalf.

  • MEPDN provides the donor with a US compliant tax-deduction acknowledgement on your behalf.
  • MEPDN manages the bookkeeping of the funds and all US reporting requirements.
  • MEPDN wires the money directly to your foreign bank account as soon as the donation clears its bank account.

MEPDN does not perform any other back-office functions on behalf on the sponsored organization.

How to apply for MEPDN’s
fiscal sponsorship

We offer fiscal sponsorship to non-profits duly registered outside the US.  

To indicate your interest, please send us an email requesting consideration for fiscal sponsorship. Include the following information: 

  • Organization’s name, address and website URL 
  •  Executive Director’s name and email  
  • What type of fundraising do you plan to do in the US 
  • How much money you anticipate raising in the US during your fiscal year 

If approved, your Executive Director must be able to:  

  • Provide us with a copy of your non-profit registration and an English translation. 
  • Sign a Memo of Understanding (MOU) that confirms that your organization is not involved in any terrorist activities directly or indirectly through your activities or programs. 
  • Affirm that none of your activities or programs are in support of or in opposition to any political candidate or party in your country. 

How much does MEPDN charge to enter into a fiscal sponsorship relationship?

MEPDN charges an administrative fee of 3% but not less than $30 or more than $15,000 per wire transfer. 

There is no fee charged if no money is donated to MEPDN directed to your organization.

You can cancel our sponsorship relationship at any time

Sponsorship can be cancelled at any time with written notice by either MEPDN or the sponsored organization.

It becomes the organization’s responsibility to notify US donors that the relationship has terminated and that donations should no longer be made through MEPDN.

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