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January 18, 2023

Giving Beyond Borders: How to Support an International Cause

Post By:
Abigail Axelrod-Wunderman
In-House Contributor
Philanthropic Director
Fiduciary Trust International
Guest Contributor:

It probably comes as no surprise that Americans are a generous society. According to Philanthropy Roundtable, Americans give seven times more than Europeans, and Canadians only give half as much as their US counterparts. And even with a global pandemic, economic crisis, and the recent war on Ukraine, we continue to see Americans sending their donations to international affairs.

So, what does this mean for charities in the United States? Can Americans support causes both at home and abroad?

Giving USA’s most recent Annual Report on Philanthropy reported that individuals, bequests, foundations, and corporations gave an estimated ~$485 billion to US charities in 2021. Looking at this another way, you can say Americans gave over $1 billion a day to charity. 

Giving to international affairs was estimated to be around $27.4 billion, staying consistent with 2020 and growing by just over 12.3% from 2019. With the state of global concerns, it’s no wonder that we as a people are looking beyond our borders and attempting to close the inequitable gaps alongside other international givers. 

If you’re looking to take your philanthropic outreach to the international level, there are several notable causes and ways to help.

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Recent International Causes

Disasters have always been a catalyst for international giving, and recent history shows this trend is still valid. Some recent examples:

Covid-19 (2020-present) – Covid-19 has been more than a health crisis. Food security has been one of the biggest threats to the overall health of the human population for several years-- even more so than malaria, tuberculosis, or HIV. And sadly, 2020 and 2021 saw the most severe

increase in global food insecurity due to the pandemic. Americans supported these organizations at a higher rate than ever before. Food banks, homeless organizations, youth programs, and other basic-need nonprofits all fit into the human services groups, and collectively US human services received $65 billion. The US government has been one of the World Health Organization's largest donors through the pandemic. From 2020 to 2021, the US was the third-largest donor; number two was the Bill and Melinda Gates Foundation (at nearly $800 million).

Earthquake in Haiti (2021) – The 7.2 magnitude earthquake on August 14, 2021, killed more than 2,200 people and injured over 12,000 others. Thousands of homes were destroyed or damaged. The total value of the damages equaled about $1.7 billion. When these types of tragedies occur, we often look to organizations like the United Way and giving vehicles (like donor-advised funds), which send their reserved funding to aid communities in need. Those entities fall under "public-society benefit organizations." Collectively, these benefit organizations gave $48 billion in 2020, and have had a track record of growth year after year. Likewise, foreign government support is often a significant aid contributor. While fundraising for Haiti relief is still ongoing, the US has provided over $32 million in humanitarian aid and several supplies and human resources.

War in Ukraine (2022)Reuters has an approximate ongoing summary of war-caused losses in Ukraine. At the time of writing, there were estimated to be over $600 billion in damages and nearly 50,000 deaths. While these losses are still accumulating, aid from international sources have already stepped in. For example, Charities Aid Foundation America (CAF America) has the ability for US donors to give to CAF America (receive an immediate deduction because CAF America is a US-based 501c3 public charity) and recommend a grant to a foreign organization. Currently, CAF America works with nearly 500 donor-advised funds, and supports individual donors as well. It is also important to note that while donating to the War in Ukraine is of great need, there are some restrictions about what you can and cannot give. Due to the political nature of this disaster and international sanctions on Russia, it is vital to understand how these impact donors. Another trend that has increased in 2022 is cryptocurrency donations, especially for global giving. Ukraine has raised more than $60 million in digital coin donations. 

Beyond natural and man-made disasters, underlying global concerns are constantly at play and need support. Examples may include environmental issues, such as mitigating global carbon emissions. 

Reduce Food Waste- Project Drawdown, a scientific publication on the top climate solutions to lower CO2 emissions by 2050, shows how reducing our food waste worldwide can significantly impact deforestation of farmland. This will prevent more CO2 emissions from being released into the atmosphere. Worldwide, a third of the food raised and prepared never gets consumed, and that wasted food is responsible for 8% of all global emissions. You can help by supporting organizations working with lower-income countries to improve food storage infrastructure, processing, and transportation. Not only will you reduce emissions, you will also be solving our growing global hunger concerns. 

Increase Global Education for Women and Girls- Looking at the same publication, Project Drawdown, the research shows education and family planning with all populations of women and girls is essential for carbon mitigation and improvements in global health. Millions of girls around the world lack access to education. Lack of access to proper education is often due to costs, location of the school to where they live, health issues, and equity in the school systems. To help the cause, find and support an organization that is making strides in one of those areas. 

Ways to Give Internationally (and Get a Tax Deduction!)

IRS rulings permit a US charity to perform all or part of its charitable activities in a foreign country. Therefore, even though an individual taxpayer would not receive a tax deduction for donating to a foreign charity, they could make a tax-deductible donation to a US charity that conducts charitable activities in a foreign country. Many US-based 501c3s are working with programs (running activities) in a foreign county. Likewise, to support international philanthropic activities, you could look to donate to a US "friends of" organization-- typically a US organization that supports a well-known foreign charitable or cultural institution. You can also look to nonprofits like CAF America (as mentioned earlier), which can assist with single or multi-year grants to foreign nonprofits through various services.

If you have a private foundation or donor-advised fund (DAF), you can use these vehicles to make grants to international charities. However, there are complexities. Unless the foreign charity received a determination letter from the IRS recognizing it meets the standards to qualify as a US public charity, the private foundation or DAF would need to comply with additional regulatory guidelines. These added guidelines ensure grants to foreign charities are not subject to tax penalties. Specifically, the private foundation or DAF will need to do one of two things: 1) practice "expenditure responsibility" concerning the grant, or 2) make a "good faith" determination that the foreign charity is the equivalent of a US public charity, something called an "equivalency determination."

Given the variety of options and intricacies involved in global giving, it is generally in the donor's best interest to consult with legal counsel. Furthermore, a philanthropic consultant can be a helpful resource when considering what type of charity to support for your international giving. 

No matter which cause you choose, giving beyond borders can truly make a difference.