American Charities are Footing the Bill for Israeli Settlements

In August 2025, Israel approved plans for the construction of 3,400 new settler homes in East Jerusalem, Palestine. The current, right-wing Israeli government under criminally indicted Prime Minister Benjamin Netanyahu intends this plan—in keeping with the central intent of the entire Israeli settlement movement—as a project which would forever prevent a viable and contiguous Palestinian state from being founded in the West Bank. Israelis in government today publicly defend the expansion of the settlements as a method to cope with the natural increase of the settler population in the occupied Palestinian territories (a population now numbering almost a million people living in Jewish-only towns and cities). Netanyahu and his ministers intend the settler population to eventually expand to rival the indigenous Palestinian majority in the region. 

To recruit settlers to these communities, the Israeli government leverages the housing crisis within Israel proper, suggesting to its citizens that a more affordable option is available to them in West Bank settlements (internationally recognized as illegal entities). Once ensconced in these Jewish-only cantons, the government offers monthly stipends and rent assistance as well. 

Additionally, these settlements (at least 350 of them) contain swimming pools, community centers, and large, lush, private yards, rare for homes inside of Israel. The Israeli government also provides financial assistance for settlement communities including cheap or free water, electricity, and private settler-only roads. Supplementing this state funding, though, is covert money donated by American citizens through tax-exempt, U.S. organizations officially registered as charities. 

Tax-Free Ethnic Cleansing 

Section 501(c)(3) of the U.S. tax code says that federal tax exemption applies to any corporation, fund, or foundation organized and operated exclusively for religious, charitable, scientific, public safety, literary, or educational purposes. As 501(c)(3) organizations, U.S. churches and charities are, therefore, not taxed. Further, every donation made to charity in the U.S. counts against that person’s overall tax bill. In other words, when charitable donations are used to support illegal Israeli settlements, the U.S. government is subsidizing those donations in the form of tax credits provided to the donors. 

A New Line Magazine piece titled described the Israeli settlement of Beit El, an extremist community just of the Palestinian cultural capital of Ramallah with an extensive history of violence towards Palestinian civilians. According to New Lines Magazine, Beit El is funded nearly entirely by American charities, specifically the American Friends of Beit El group run by ultra-Zionist American Baruch Gordon.

But the American Friends of Beit El is hardly a unique organization. There are several dozen charitable organizations based in the U.S. that give money to Israeli settlement, some operating with a budget in the millions. The One Israel Fund, for example, received about $7 million in donations in 2023, a substantial increase from previous years. And while the One Israel Fund is not dedicated to sustaining one specific illegal town in occupied Palestine, other groups support a single settlement or a linked settlement bloc within the West Bank.

For the American Friends of Beit El though, the faulty pretense under which they send money to that settlement is the idea that they are building a religious educational facility for students to study the Torah. Beit El head Baruch Gordon also runs a separate charity called Israel Empowered. On its form 990, the document filed annually with the IRS to declare the activities of tax-exempt groups, they say their aim is to create an environment through which individuals can attain an understanding and appreciation of their Jewish heritage and identity. In fact, Gordon uses this specific charity to raise money to buy thermal drones for settlers which aids in their surveillance and torment of the indigenous Palestinians living nearby. There is little follow-up with the discrepancy in 900 filings in the U.S. though, at least in part because the current U.S. administration agrees with the colonialist goals of the settlement movement. 

Another, more generally organized pro-Israel aid organization based in the U.S. is known as the One Israel Fund. They actually establish new settlement outposts, places euphemistically labeled as “farms,” where extremist settlers have taken over Palestinian land. The One Israel Fund sees to it that these colonizers are supplied with paramilitary equipment like drones and all-terrain vehicles (ATVs), which have been shown by human rights organizations being used as tools for the targeting of Palestinian civilians in settler attacks. Infamous extremist Yinon Levi of the Yitzhar settlement, for instance, who recently murdered Palestinian peace activist Awdah Hathaleen in the village of Umm al-Khair, regularly used his One Israel Fund ATV to target, harass, and assault Palestinian civilians. Despite the presence of video showing Levi shooting Hathaleen, Levi, previously sanctioned by the European Union and the Biden administration for his terrorist activities, went free after Hathaleen’s murder. 

Pro-settler groups like these operate freely as tax-exempt organizations in the United States by exploiting an utter lack of IRS enforcement. They obfuscate, author vague statements, or lie outright on their annual 990 filings detailing the scope of their “charitable” activities to cover up the amounts of money given to illegal Israeli settlements. This strategy makes it nearly impossible to pinpoint how much money is moving from the United States to land in illegal Israeli settlements. Clearly though, this ostensible aid activity falls outside of legal 501(c)(3) activity, which doesn’t allow any U.S.-based organization to finance illegal outposts in Israel or anywhere else. They are therefore directly responsible for fueling violence and instability in furthering the Israeli goal to annex the West Bank with as few indigenous, Palestinian inhabitants on that land as possible.

The Impact of Christian Zionism 

The current U.S. Ambassador to Israel, Mike Huckabee, is a direct supporter of pro-settlement charities based in the U.S. This is in keeping with his position as an avowed Christian Zionist, a largely American philosophy that has deemed Israel to be the Holy Land that will see the Second Coming of Jesus Christ once Jews and Jews alone inhabit that territory. From this deeply flawed theological basis, Christian Zionist organizations in the United States send volunteers to the West Bank to help build settlements while acting as human shields for the Israeli settlement movement. 

Some human rights organizations even suggest that Christian Zionist pro-settlement organizations are harder to report on and often cagier in their self-declarations to the IRS. This may be a function of the fact that they are savvier to the fact that unconditional support of the Israeli settlement movement is a controversial issue in the United States. In any case, it’s not just Jewish diaspora organizations that are offering ideological and financial support to extremist settlers. It’s also Christian Zionist groups contributing to this ongoing ethnic cleansing of Palestine.

The American Left and the Future of the Extremist Settler Movement

Among those working to arrest this disturbing trend, New York City mayor Zohran Mamdani has proposed the Not on Our Dime Act. This bill would strip tax incentives away from charities that support Israeli settlements or other violations of international law. Mamdani’s motion can be seen as an extension of the former U.S. President Joe Biden administration’s sanctions on Israelis that they considered extremists in the settler movement, some of whom had a direct personal connection to American charities. 

And officially, U.S. state and foreign policy goals have long held that Israeli settlements are in violation of international law and that the West Bank is the heartland of a future Palestinian state. During his presidency, Joe Biden imposed sanctions on 33 individual settlers and a handful of organizations attached to these illegal outposts while also freezing millions in assets held by settler organizations. But when the Biden administration applied these sanctions, they chose to target mostly individuals for specific acts of violence. And upon ascending to his second macabre administration, Donald Trump reversed Biden’s sanctions allowing even the most violent of Israel’s extremist settler population to act with international impunity. 

In the future, if a U.S. presidential administration is serious about deterring settler violence and forcing a political solution in Palestine while preventing Americans from materially violating international law, they could impose sweeping sanctions that would make it very risky to fund settlements from the United States. This would require enshrining an executive order as a bill passed by Congress. If that were to happen, and sanctions were to be placed on violent settlers enshrined in permanent law, that would discourage these organizations from their continued activities which would risk U.S. sanctions and be perceived as exacerbating violence and instability in the Middle East.