To amend the Internal Revenue Code of 1986 to provide that 501(c)(3) organizations are liable for the use of funding provided as a fiscal sponsor.

# Summary of HR 7799 **What the Bill Would Do** This bill would change the rules for how tax-exempt nonprofit organizations (501(c)(3) groups) operate as "fiscal sponsors." A fiscal sponsor is a nonprofit that receives and manages money on behalf of other organizations or projects that may not have their own nonprofit status. The bill would make fiscal sponsors legally responsible for how the money they receive and distribute is actually used. Currently, the legal responsibility structure for fiscal sponsorship arrangements isn't clearly defined in tax law. **Who It Affects and Key Provision** The bill primarily affects established nonprofits that act as fiscal sponsors, as well as smaller organizations, projects, and groups that rely on fiscal sponsors to handle their funds.

By holding fiscal sponsors liable for how funds are used, the bill would likely increase accountability and oversight throughout the nonprofit funding chain. This could prevent misuse of charitable donations or tax-deductible funds flowing through intermediary nonprofits. **Current Status** The bill was introduced by Representative Nathaniel Moran (R-TX) and is currently in committee review. It has not yet been voted on by the full House or moved forward in the legislative process.