We are a Dutch foundation. This has advantages such as not fearing a government crackdown or surveillance, but disadvantages for donors. You can write donations to us off your taxes in the Netherlands, but the Netherlands is a small country and most of our donors are outside it.
A short explanation of how this works is in order.
Every country wants people to contribute to organizations like ours that promote the public good. So in most countries you can write off donations to charity in your taxes. Unfortunately there’s an obvious way to abuse the system. Bob asks his cousin Carl to make a charity. Carl makes a ‘Save Bob’ charity, accepts a donation from Bob, and hands Bob the money back, tax free. The universal fix is to regulate charities, and as our accountants and volunteers who file the paperwork can tell you, they definitely do that.
Bob and Carl live in Pleasantland. They can easily end run the tax authorities by having Carl establish the charity in NotSoPleasantland, a country with lax enforcement. The tax folks stop this by only letting Bob write off donations given to charities registered in Pleasantland.
Alice also lives in Pleasantland. She wants to give to Trans Rescue and wants to take it off her taxes. So instead she gives to HelpingPeople, a Pleasantland charity, for their ‘Trans Rescue fund’. HelpingPeople sends us the money. Obviously HelpingPeople has to have an agreement in place with Trans Rescue. And HelpingPeople in turn becomes responsible for ensuring we spend the money appropriately. Which is a pain, particularly for HelpingPeople. This arrangement is called a ‘fiscal wrap’.
Fortunately we have such an arrangement, although ours is more complex. We can accept funds via Forbidden Colours, who in turn accepts them from the Myriad fund, which is incorporated in most countries. Unfortunately, since it’s a pain to administer all this, we are only allowed to use this system for amounts over 5000 EUR.
So why not form a ‘Pleasantland Friends of Trans Rescue’ in Pleasantland? We’ve spent time and money investigating just this sort of thing. There are 192 countries on earth. It cost us several thousand euros to form our main corporate identity in the Netherlands. Beyond the time and expense, such incorporation comes with scrutiny. An obvious choice for a ‘Friends of’ is the USA, as over half our donations come from there. But right now we don’t really want the USA government to have a legal excuse to demand our records. Our financial records contain payments for passengers. If the government demands to see the case files to ascertain that the passengers are ‘real’, there is nothing then stopping them from passing those files to another government, one that rounds up LGBT people. Or from gathering lists of our donors, something we don’t want the USA doing.
I hope this helps explain our limits. If you are contemplating a donation over 5000 EUR, please drop an email to annie@transrescue.org and we can arrange the fiscal wrap for most countries.
Sorry for boring tax stuff.
Annie