Executive Order on Overseas Grants Will Impact Global Mosdos

An executive order being considered by President Trump would restrict nonprofit organizations from sending grants overseas, limiting the outflow of U.S. dollars by political adversaries. However, this policy could also impact many Chabad and other Jewish nonprofits in the U.S. that send funds abroad.

By Anash.org reporter

President Trump is considering an executive order that would restrict nonprofit organizations from sending grants overseas, the New York Post reported. The move is part of Trump’s broader push to limit the outflow of U.S. dollars, particularly from organizations he sees as political adversaries. However, this policy could impact many Chabad and other Jewish nonprofits in the U.S. that send significant funds abroad.

Currently, under U.S. law, nonprofits that are exempt from federal income tax are allowed to provide grants to foreign entities as long as the funds are used for charitable purposes. This is made possible by the donor tax exemption, which allows U.S.-based donors to support international causes.

The proposed executive order would seek to curtail this practice by limiting the ability of these nonprofits to send funds outside the country. The move is part of a broader effort to scrutinize and tighten control over the flow of American charitable dollars abroad. It appears to be aimed at large, politically influential foundations – such as the Bill and Melinda Gates Foundation, the Chan Zuckerberg Foundation, and the Open Society Foundations – which fund global initiatives and are perceived to oppose Trump’s policies.

“There’s definitely an effort to limit and scrutinize federal tax dollars being shipped overseas,” a source close to the White House told The Post.

However, the executive order would not only affect major players, but it could also significantly impact smaller Jewish and frum nonprofits, including many Chabad organizations. With a global network of Chabad Houses, schools, youth programs, and social services like those run by Colel Chabad, much of Chabad’s international work depends on the U.S.-based nonprofits, which allow donations raised in the United States to be sent abroad to fund their programs.

Grants from U.S.-based organizations like Chabad On Campus International, Merkos 302, or the Rohr Foundation, which many shluchim outside the U.S. rely on, could be restricted under the proposed executive order. Likewise, many mosdos and shluchim in places like Eretz Yisroel and beyond have established American nonprofit entities to help fund their operations.

For example, American Friends of Reshet Chabad supports a network of Chabad schools in Israel, while Chabad Outreach of Eastern Europe provides assistance to Jewish communities across the former Soviet Union. If the order is enacted, these vital funding channels may no longer be viable, potentially disrupting key programs. Many other frum organizations with overseas projects would likely face similar hurdles.

If enacted, the executive order could change much of how the U.S.-based nonprofits support international causes, affecting everything from Jewish education to shlichus and social services around the globe.