Many Jewish philanthropists allocate part of their portfolio to giving in Israel. But they quickly find that funding Israel from abroad can be significantly more challenging, given the less-familiar landscape, and differences in culture, law, and language. There is also the need to comply with U.S. regulations regarding overseas grantmaking. But these are challenges, not insurmountable obstacles. With time and a little patience, they can be overcome.
Here are some key points to keep in mind when looking to fund in Israel:
Give to organizations that have been certified by the government.
There are about 36,000 registered amutot (nonprofit organizations) in Israel that span the spectrum in their level of sophistication and management. Out of those, about 15,000 have a nihul takin certification. This indicates the organization is viewed by the government as properly managed and is eligible for public funding. It is the closest equivalent in Israel to 501 (c)(3) status in the U.S., and is also the tool used by intermediary organizations that filter overseas money to Israel to provide tax deductibility in the U.S. Go here for a glossary of common terms used by Israeli nonprofits. Click here for a glossary of terms associated with giving in Israel.
Evaluate Israeli nonprofits the same way you do your U.S. grantees.
Tax returns for Israeli nonprofits are not publicly available like they are in the U.S. Still, there are other methods to ensure a nonprofit is financially sound and properly managed. First, ask for detailed work plans and budgets. The more transparent the nonprofit is the better. Also, request a copy of the organization’s filings with the Registrar of Non-Profit Organizations, which awards the nihul takin certification, or look it up in Guidestar Israel. It is often worth the effort to have a Hebrew speaker analyze those reports for you.
Use resources available in Israel.
Social issues, legal terms and financial practices may sound familiar to overseas funders, but can have a different context in Israel. Local philanthropists, foundation professionals, consultants, and the JFN Israel office can help you interpret the local landscape, identify innovative programming areas and adapt vetting practices.
Find a partner.
While overseas funders can successfully go it alone in Israel, it can be very helpful to have a local “interpreter,” who can cut through the bureaucratic thickets, and provide valuable insights about the fields that interest you. Fully one-quarter of JFN members are Israeli, and JFN’s Israel office can introduce you to like-minded funders with on-the-ground knowledge in the fields that interest you.
The dividends reaped by funder collaborations go way beyond a particular project. You will quickly become attuned to the hands-on entrepreneurial style of philanthropy typical in Israel. The nonprofit sector is relied on by the Israeli government as an incubator for ideas that can be adapted nationally. Too many demands preclude a government-led, top-down approach to solve many issues in Israeli society.
Consider using Keshet-DAF, the Israeli donor-advised fund JFN helped launch in 2020.
Overseas foundations that allocate money in Israel are eligible to open donor-advised accounts through Keshet, saving them the expense and hassle of operating an office in Israel. Some the largest Jewish foundations in the United States — including Baltimore’s Harry and Jeanette Weinberg Foundation and the Russell Berrie Foundation in New Jersey — have already opened such accounts.
Last, but certainly not least, in order to comply with U.S. regulations, always check with your financial and legal advisors before making any overseas donations.
For more information, contact the JFN Israel office at [email protected].