To amend the Internal Revenue Code of 1986 to require reporting by certain charitable organizations relating to fiscal sponsorship arrangements, and for other purposes.
About This Bill
Committee
Latest Action · July 16, 2026
Referred to the House Committee on Ways and Means.
The Fiscal Sponsorship Transparency Act of 2026 requires tax-exempt charitable organizations to report detailed information about their fiscal sponsorship arrangements to the Internal Revenue Service, including the names of parties involved, amounts transferred, descriptions of activities funded, the managing officer, and arrangement dates. The bill also creates new tax penalties for "improper conduit arrangements," where charities solicit donations for specific individuals or entities while failing to exercise proper control over how the funds are used, imposing a 20 percent tax on the organization and up to 5 percent on managers who knowingly agree to such arrangements, with escalated penalties of 100 percent and 50 percent respectively if the improper conduct is not corrected. These changes apply to most tax-exempt organizations except private foundations and donor-advised funds, and the reporting and penalty provisions take effect for tax years beginning after December 31, 2027. The legislation aims to prevent charitable organizations from being used as pass-through vehicles for donations directed to specific non-exempt individuals or entities while sidestepping normal tax and donation rules.
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