Long story short, donations to Hope in Honduras can be deducted from your taxes through a process called fiscal sponsorship. But what exactly is this fiscal sponsorship and why do we do it?
It is often a long and strenuous process to be granted 501(c)(3) tax-exempt charity status. This leads to many new non-profits opting for fiscal sponsorship instead. Fiscal sponsorship refers to the practice of a 501(c)(3) non-profit organization offering their legal and tax-exempt status to a newly formed non-profit that shares in the values and mission. According to Council of Non-Profits Organization, a “fiscal sponsorship is often used by newly formed nonprofits that need to raise money during the start-up phase, before they are recognized as tax-exempt by the IRS. Using a fiscal sponsor enables a program or organization that does not itself qualify as tax-exempt to attract funding for its operations that will — through the fiscal sponsor – be tax-deductible to donors. Therefore fiscal sponsor arrangements benefit organizations or programs that are not tax-exempt by providing a flow-through pathway for revenue that the organization may not otherwise be in a position to receive.”
Hope in Honduras’ fiscal sponsor is the Honduran Children’s Rescue Fund, a nonprofit organization that share in both our values and commitment to improving the conditions disenfranchising Honduran children. To visit our sponsor’s webpage, click here. http://honduranchildren.com/about-friends-of-honduran-children/
Citation: “Fiscal Sponsorship for Nonprofits.” National Council of Nonprofits. N.p., 28 Nov. 2016. Web.