GUARD Act

Plain-English Summary

This bill would change federal tax law to prevent certain nonprofit organizations from keeping their tax-exempt status if they receive donations or gifts from citizens or nationals of countries considered "foreign adversaries" of the United States. In other words, if a qualifying nonprofit accepts money from individuals who are citizens or nationals of specific foreign countries that the U.S. government has designated as adversaries, that organization could lose its tax-exempt status under the Internal Revenue Code.

The bill would primarily affect nonprofit organizations — such as charities, advocacy groups, educational institutions, and other tax-exempt entities — that currently enjoy special status under the tax code, meaning they don't pay federal income taxes and donors can often deduct contributions. Under this proposal, accepting funds from citizens or nationals of designated foreign adversary nations (which could include countries like China, Russia, Iran, or North Korea, depending on how the law defines that term) could put that tax-exempt status at risk.

This legislation would impact a wide range of groups — from large universities and think tanks to smaller nonprofits — that may receive international donations or have donors with foreign citizenship. Organizations would likely need to more carefully screen their donors' nationalities to remain compliant. The bill has been referred to the House Committee on Ways and Means, which handles tax-related legislation, but has not yet advanced further in the legislative process.