Representative Nathaniel Moran (R-TX) recently introduced HR7799 to amend the Internal Revenue Code of 1986 to provide that 501(c)3 organizations are liable for the use of funding provided as a fiscal sponsor.  The "Stop Proxy Organizations Nurturing Subversive Operations and Riots ("SPONSOR") Act" is a proposed a proposed federal bill targeting protest activity by expanding civil and criminal liability to fiscal sponsors. It specifically targets 501(c)(3) organizations supporting groups engaged in protests that block commercial, transport, or energy infrastructure. The bill essentially makes fiscal sponsors liable for "covered activities' conducted by groups they support, even if the sponsor only provides administrative support or grants. 

The SPONSOR Act is similar to the Nonprofit "Killer" Bill (H.R. 9495/S. 3554) that was re-introduced on Dec. 17, 2025, which allows the Treasury Department to revoke the tax-exempt status of organizations deemed to support terrorism, which critics fear could be used to penalize organizations supporting protest movements. 

Both bills face opposition from civil liberties groups, who argue they could be used to silence dissent by creating high financial and legal risks for organizations that support advocacy.