Requires certain charities to report their fiscal sponsorship arrangements to the IRS and imposes taxes on improper conduit arrangements that route donations to people or groups without tax-exempt status.

• Adds to the annual information return rules for charities, requiring each fiscal sponsorship arrangement to list the parties, the amounts transferred, a description of the activities, the managing officer, and the start and end dates.
• Defines a fiscal sponsorship arrangement and excludes private foundations and donor advised funds from the reporting requirement.
• Denies a charitable contribution deduction for gifts made under an improper conduit arrangement.
• Imposes a 20% tax on the organization for amounts transferred under an improper conduit arrangement, and a 5% tax on any manager who knowingly agrees to the transfer, capped at $10,000.
• Imposes a 100% additional tax on the organization if the transfer is not corrected, and a 50% tax on any manager who refuses to agree to the correction, capped at $20,000.
• Directs the Treasury to issue regulations and applies to taxable years beginning after December 31, 2027.

• Ways and Means Committee (House)

Taxation