FundSvcs Community

I had a DAF administrator contact me recently.  They were doing an audit of a donor advised grant they had issued.  The grant was a scholarship that was awarded by a high school committee not affiliated with the University.  The grant bypassed my office and was deposited directly to the student's account who was granted the scholarship.  Since this type of payment from a DAF is not allowed under IRS regulations (the recipient being a person and not a 501c3), the administrator is asking us if we can issue them a refund and then they (the DAF administrator, a bank) would issue us an unrestricted gift in the same amount.  Has anyone come across this scenario?  How was it handled.  The grant in question was split between semesters, half was distributed in the fall of 2023 and the other half in the spring of 2024. I've brought this to the attention of my Business Office.  They weren't exactly sure how to handle it.  

Thanks for any advice!

Michael

I had a DAF administrator contact me recently.  They were doing an audit of a donor advised grant they had issued.  The grant was a scholarship that was awarded by a high school committee not affiliated with the University.  The grant bypassed my office and was deposited directly to the student's account who was granted the scholarship.  Since this type of payment from a DAF is not allowed under IRS regulations (the recipient being a person and not a 501c3), the administrator is asking us if we can issue them a refund and then they (the DAF administrator, a bank) would issue us an unrestricted gift in the same amount.  Has anyone come across this scenario?  How was it handled.  The grant in question was split between semesters, half was distributed in the fall of 2023 and the other half in the spring of 2024. I've brought this to the attention of my Business Office.  They weren't exactly sure how to handle it.  

Thanks for any advice!

Michael

I had a DAF administrator contact me recently.  They were doing an audit of a donor advised grant they had issued.  The grant was a scholarship that was awarded by a high school committee not affiliated with the University.  The grant bypassed my office and was deposited directly to the student's account who was granted the scholarship.  Since this type of payment from a DAF is not allowed under IRS regulations (the recipient being a person and not a 501c3), the administrator is asking us if we can issue them a refund and then they (the DAF administrator, a bank) would issue us an unrestricted gift in the same amount.  Has anyone come across this scenario?  How was it handled.  The grant in question was split between semesters, half was distributed in the fall of 2023 and the other half in the spring of 2024. I've brought this to the attention of my Business Office.  They weren't exactly sure how to handle it.  

Thanks for any advice!

Michael

I had a DAF administrator contact me recently.  They were doing an audit of a donor advised grant they had issued.  The grant was a scholarship that was awarded by a high school committee not affiliated with the University.  The grant bypassed my office and was deposited directly to the student's account who was granted the scholarship.  Since this type of payment from a DAF is not allowed under IRS regulations (the recipient being a person and not a 501c3), the administrator is asking us if we can issue them a refund and then they (the DAF administrator, a bank) would issue us an unrestricted gift in the same amount.  Has anyone come across this scenario?  How was it handled.  The grant in question was split between semesters, half was distributed in the fall of 2023 and the other half in the spring of 2024. I've brought this to the attention of my Business Office.  They weren't exactly sure how to handle it.  

Thanks for any advice!

Michael

Thank you for the responses everyone.  Isaac, the "them" is the DAF administrator.  In this case it was Schwab Charitable. 

Michael

I had a DAF administrator contact me recently.  They were doing an audit of a donor advised grant they had issued.  The grant was a scholarship that was awarded by a high school committee not affiliated with the University.  The grant bypassed my office and was deposited directly to the student's account who was granted the scholarship.  Since this type of payment from a DAF is not allowed under IRS regulations (the recipient being a person and not a 501c3), the administrator is asking us if we can issue them a refund and then they (the DAF administrator, a bank) would issue us an unrestricted gift in the same amount.  Has anyone come across this scenario?  How was it handled.  The grant in question was split between semesters, half was distributed in the fall of 2023 and the other half in the spring of 2024. I've brought this to the attention of my Business Office.  They weren't exactly sure how to handle it.  

Thanks for any advice!

Michael