Our Not-for-Profit, Tax-Exempt Status (and How To Send Us Your Money!) with photos of our Honduran employees at the bottom.

For a small, two-person charitable project, the learning curve related to achieving not-for-profit status was formidable, especially with a significant lack of knowledge in this area and state and federal laws supplying more hurdles than help.  We put a lot of effort into obtaining tax-exempt status, often referred to as 501(c)3, which allows contributors to deduct their donations from their taxes, but the costs involved for lawyers and accountants seemed insurmountable.  Eventually and fortunately we learned from a contact in Honduras about the National Heritage Foundation (NHF, www.nhf.org), a group whose mission was to put small organizations such as ours under their tax-exempt umbrella as long as the purpose is consistent with not-for-profit ideals and actions.

In 2006 Congress changed the laws related to charitable giving which resulted in Las Sonrisas de los Niños being transferred to a division of the NHF (which actually went bankrupt in 2008) called Congressional District Programs. In 2011 the name was changed again to United Charitable Programs (UCP) and essentially any tax deductible donations made to us go to the UCP, and instead of being directly spent by us we must first spend money from our own resources then request reimbursement.  We have to prove the money was appropriately used for charitable purposes and supply receipts and other records before we receive any re-imbursement.  A disclaimer type statement is found on the opening page, and is repeated here with additional links to various required legal notices- Las Sonrisas de los Niños is a project of United Charitable Programs (www.UnitedCharitablePrograms.org)– a registered 501(c) (3) public charity.  Donations are tax-deductible as allowed by law.  All funds raised by Las Sonrisas de los Niños are received by United Charitable Programs and become the sole property of UCP which, for internal operating purposes, allocates the funds to the Project. The Program Manager makes recommendations for disbursements which are reviewed by UCP for approval.  Privacy Policy link http://www.unitedcharitableprograms.org/privacy-policy,  State Fundraising and Solicitation Guidelines link http://unitedcharitableprograms.org/state-fundraising-disclosures, Non-Discrimination Policy link  http://www.unitedcharitableprograms.org/forms/NondiscriminationPolicy.pdf                                                                                                                                                                                                                                                      

To the present we self-limit the categories of expenditures for which we request reimbursement to the following (this is why we can say 100% of all donations go directly to operating the project):

1) Wages to the women we employ from the village (see photos below)

2) Food and supplies for the feeding programs we support or directly provided by us

3) Supplies associated with cleaning and maintenance of the project (soap, laundry detergent, bleach, paper towels, and the like)

4) Fuel (gas for cooking and the project electric bills)

5) Misc., such as medicines, toothbrushes, toothpaste, clinic visits, children's vitamins (though we've luckily received many donations of actual vitamins and have not yet needed to purchase any)

6) Program activity supplies, including books, arts & crafts supplies, toys, paper, games, copies of pages out of coloring books (previously a fairly large expense), kids movies on DVD, and special event items (e.g. a piñata).  More recently these supplies have also included lumber, screws, etc for the carpentry classes and fabric and notions for the women's sewing co-op.

The way that the UCP makes money for its operations is an 8 percent deduction from all donations, so that of a $100 donation we receive $92 and the UCP $8; overall a favorably low administrative fee (though when we first started this arrangement it was 3 1/2%! but we understand they need to be financially sound to perform their good work) with no need to divert money from kids to lawyers and accountants. 

In May or June 2013 UCP notified us along with all of their programs that the IRS, in a zeal to reform some unknown problem, declared that programs working outside of the US had to obtain some equivalency of tax-exempt status in the home country or be absorbed by such an organization.  Perhaps this sounds like a minor paperwork process, but from what we have heard this has gutted many small projects.  Most people don't understand that governments, especially ones such as Honduras, thrive on bureaucracy and place as many obstacles as possible in the way.  Pretty much all areas of importance to extranjeros (ex-patriots) are involved- obtaining residency, buying property (which we actually accomplished), and officially establishing NGO type status.  A friend of ours spent three years trying to obtain a license plate for a vehicle he drove into Honduras from the US and was never able to achieve this!  Often bribery is required but even this offers no promises of success.  FORTUNATELY, there is a loophole in this great IRS brainchild which allows short term (less than 90 days) missions to continue to receive tax-exempt donations.  As noted on the opening page, we have altered our project to more specific goals in shorter "mini-sessions" so as it stands we can take advantage of this loophole and continue to receive disbursements from UCP.

SO…if you are itching to make a tax-deductible contribution to us, make a check out to Las Sonrisas de los Niños and send it to: 2343 Wrighter Lake Road, Thompson, PA 18465

Below- our employees old and new (11 photos): Mirian, to whom we owe so much; between us and our contractor Jesus we've been trying to teach her to drive;  our mujeres for Session Four, Claribel, Mirian 2, Mirian 1, Yolanda- it is difficult to take them seriously as long as they are wearing balloon hats;   Mirian showing Becky and Sonia how to make tortillas in March, 2008;  former employee Blanca with volunteer Lena and older kid Elvia; former employee Lupita and her daughter;  Yolanda with her 2 sons then Blanca with her 2 sons;  Miriam number 2 with Angie and baby Mariah (born January 2009); past employees Claribel and Anna,with little Angelo (actually Claribel was again employed by us for session 4); Gail and Becky returned to Honduras in June 2008 and, even though we were closed at the time, visited the project and Mirian, the photo was taken in Miriam's house;  former employee Magdelena