Church Contribution to Foreign Church Not Recognized as a 501(c)(3)

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Question:

A church would like to send funds to a foreign church. This foreign church is not an Internal Revenue Code section 501(c)(3) organization; it is simply a small ministry in need of help. Is there a problem if the church donates to this foreign church?

Answer:

According to IRS Publication 526, deductible contributionsmay only be made to “qualified organizations.” The only foreign charities thatare cited in the publication as permissible are charities in Canada, Mexico,and Israel. Often, U.S. missionaries in foreign countries will use some of theirsupport to aid local ministries that they are associated with. These type oftransfers from a US church through a U.S. missionary are not a problem.

Of course, since local churches in the United States are exempt from income taxes, they are notconcerned about getting charitable deductions for their contributions directly toforeign religious organizations. However, a church is serving as an agentfor its contributors. Care should be taken that a local church is notfacilitating contributions which would otherwise be impermissible for itsindividual members. Obviously, some U.S. charities have made grave mistakes inthis area (e.g. unwittingly supporting foreign organizations with purposes veryincompatible with their own).