FundSvcs Community

Good afternoon everyone!

I'm probably overthinking this one.  But it would make me feel better if someone can confirm this is really permissible under CASE and IRS guidelines.

We have a donor who wants to fund a prize/cash award for a group of students annually who complete their doctoral degree in a specific program, which is very small.  The drafted gift agreement says that a committee will choose the recipients, but that it will be up to the student if they want to apply this award to their student debt.  The donor specifically wants language that the student gets to keep the award for personal use.

The donor isn't picking the recipients so there's no donor control here, but I am wondering about the educational purpose of accepting this gift – it doesn't seem like it's for academic achievement.  When I asked our fundraiser about it, she said similar language had been used in the past for our emergency relief funds (COVID-era), so it seems okay, but something is tickling the back of my mind that just giving cash prizes to a group of students "because" seems like a violation of something. 😊

I assume that if the prize is not applied to their student debt, they would have to be issued a 1099, correct?  Is there something else I'm not thinking about here? 

Thanks!

Aimee S. Fitzgerald, MLIS 
Assistant Vice President 
Philanthropy & Alumni Engagement Operations

502-852-7035
aimee.fitzgerald@louisville.edu 

give.louisville.edu 

Good afternoon everyone!

I'm probably overthinking this one.  But it would make me feel better if someone can confirm this is really permissible under CASE and IRS guidelines.

We have a donor who wants to fund a prize/cash award for a group of students annually who complete their doctoral degree in a specific program, which is very small.  The drafted gift agreement says that a committee will choose the recipients, but that it will be up to the student if they want to apply this award to their student debt.  The donor specifically wants language that the student gets to keep the award for personal use.

The donor isn't picking the recipients so there's no donor control here, but I am wondering about the educational purpose of accepting this gift – it doesn't seem like it's for academic achievement.  When I asked our fundraiser about it, she said similar language had been used in the past for our emergency relief funds (COVID-era), so it seems okay, but something is tickling the back of my mind that just giving cash prizes to a group of students "because" seems like a violation of something. 😊

I assume that if the prize is not applied to their student debt, they would have to be issued a 1099, correct?  Is there something else I'm not thinking about here? 

Thanks!

Aimee S. Fitzgerald, MLIS 
Assistant Vice President 
Philanthropy & Alumni Engagement Operations

502-852-7035
aimee.fitzgerald@louisville.edu 

give.louisville.edu 

Good afternoon everyone!

I'm probably overthinking this one.  But it would make me feel better if someone can confirm this is really permissible under CASE and IRS guidelines.

We have a donor who wants to fund a prize/cash award for a group of students annually who complete their doctoral degree in a specific program, which is very small.  The drafted gift agreement says that a committee will choose the recipients, but that it will be up to the student if they want to apply this award to their student debt.  The donor specifically wants language that the student gets to keep the award for personal use.

The donor isn't picking the recipients so there's no donor control here, but I am wondering about the educational purpose of accepting this gift – it doesn't seem like it's for academic achievement.  When I asked our fundraiser about it, she said similar language had been used in the past for our emergency relief funds (COVID-era), so it seems okay, but something is tickling the back of my mind that just giving cash prizes to a group of students "because" seems like a violation of something. 😊

I assume that if the prize is not applied to their student debt, they would have to be issued a 1099, correct?  Is there something else I'm not thinking about here? 

Thanks!

Aimee S. Fitzgerald, MLIS 
Assistant Vice President 
Philanthropy & Alumni Engagement Operations

502-852-7035
aimee.fitzgerald@louisville.edu 

give.louisville.edu