Many French museums are worried that the Trump administration will end long-standing tax deductions critical to donations from American patrons sent to foreign museums, according to a new report in Le Monde.
The primary concern is that Trump could change the so-called “equivalency determination,” a process by which a foreign organization can be deemed equivalent to a public charity in the US. The status allows such organizations to receive donations in a manner similar to US nonprofits—thus allowing donors to deduct those donations on their taxes—and enables them to direct grants to foreign charities without special approval from the US. The most notable organizations in the art world that use the process are the museum-affiliated “American Friends” groups, such as the American Friends of the Musée d’Orsay and the American Friends of the Louvre, the latter of which raised $10 million for that institution last year alone.
This model also exists in other countries like the American Friends of the Israel Museum, considered to be the first such organization, has raised $450 million for that institution since its inception in 1972. The organization did not respond to a request for comment at press time.
“What we fear most is the elimination of the tax deduction for American ‘Friends Of’ associations, on the grounds that they fund museums abroad,” Lionel Sauvage, president of the Museum of Decorative Arts in Paris, told Le Monde. About one-third of the museum’s annual donations—a sum of more than $2 million—comes from American donors. Sauvage did not appear concerned, at least for now, that political turbulence in the US could affect the museum’s coffers.
“When Americans donate to us, it is not reason that motivates them but emotion. They are attached to the museum and to what it represents: the French art of living,” he said.
Indeed, the Fondation de France, which supports cultural initiatives there, told Le Monde that American donations have actually increased 21 percent since the beginning of the year—and 35 percent when looking specifically at the arts and culture sector.
“Donors tend to give more than last year for the same causes: someone who gave $20,000 will now give $25,000,” said Domitille Marchal-Lemoine, director of the Friends of Fondation de France.
While Trump has not yet taken any concrete action to eliminate the status, Bloomberg reported in April that the administration was considering the move as part of a broader crackdown on the tax-exempt statuses of nonprofits and universities that oppose his agenda.
That reporting set off alarm bells for many Jewish philanthropic organizations, many of which rely on that status to take in US donations earmarked for causes in Israel, according to eJewishPhilanthropy.
Andres Spokoiny, president and CEO of the Jewish Funders Network, an advocacy group representing 3,000 Jewish nonprofits worldwide, told eJP at the time that the reporting—and Trump’s broader statements about tax exemptions—had created “nervousness” among funders. In a statement to JFN members, Spokoiny said organizations should use the moment to strengthen compliance.
“There’s rumors and there’s media reports and there’s questions, so people get nervous,” Spokoiny told eJP of possible changes to the tax code. “My response to them is that we still don’t know. What we can do is to be compliant, which is a good thing to do in any case. And then let’s see how things play out.”
“The Jewish community is adaptable, right? Even if equivalency determination goes away, we’d find a way. But it’ll be a shock to the system,” he said, adding that any such move would likely face legal challenges.
According to eJP, US philanthropy accounted for 75 percent of all international donations to Israel in 2021, with that figure only growing in the years since.
