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  • 1.  Endowment-Funded Student Stipends at External Business

    Posted 09-09-2025 02:56 PM

    We have a few donors considering a donor-funded endowment to provide student stipends for work at several different businesses that cannot pay them directly. None of the businesses are donors. Are there any legal, tax, or compliance concerns with this structure? If so, could you provide the appropriate sections or references I could share with the Director of Philanthropy.

    Additionally, I'd be interested to hear if anyone on this thread has a similar program at their organization and can share insights on how it is managed.

    Thank you for your advice,

    Steph



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    Stephanie Pollock
    Oakland University
    spollock@oakland.edu
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  • 2.  RE: Endowment-Funded Student Stipends at External Business

    Posted 09-09-2025 03:12 PM
    I do not see how these would be gifts to the institution. The funds do not support your mission and provide taxable income to the students receiving the stipend.

    John Taylor Principal, John H. Taylor Consulting, LLC 919.816.5903 Big ideas; small keyboard



    Original Message


  • 3.  RE: Endowment-Funded Student Stipends at External Business

    Posted 09-09-2025 03:47 PM

    I do know that some institutions fundraise to provide stipends for internships where the internship is otherwise unpaid.

    Compare/contrast?

    My US$0.02 worth; the usual disclaimers apply.

     

    Good luck!

    Alan

     

    Alan S. Hejnal

    Data Quality Manager

     

    SNAGHTML5cbfa34

     

     




    Original Message


  • 4.  RE: Endowment-Funded Student Stipends at External Business

    Posted 09-09-2025 03:54 PM
    I agree with you - when the work being done is related to courses offered by the institution. I'm not sure I have seen an institution pay students to work for local businesses that are unrelated to its mission.

    At NC State, counsel actually required these "fellowships" to be handled at arm's length without a penny flowing through the University. The program was called "Graduates in Training," and other than providing a list of student names (with their permission) to the businesses, we stayed out of it.

    John

    John H. Taylor, Principal
    John H. Taylor Consulting, LLC
    2604 Sevier Street
    Durham, NC     27705

    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987





    Original Message


  • 5.  RE: Endowment-Funded Student Stipends at External Business

    Posted 09-11-2025 09:59 AM

    It sounds like the donors have named the businesses (how else would you know if the businesses are donors?)  I don't see how these could be considered charitable as I it seems as if the donors are not relinquishing control.  I think it would be a bit different if it was an endowment for unpaid internships where were no restrictions on the place of the internship.



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    Dariel Dixon
    Chautauqua Institution
    ddixon@chq.org
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    Original Message


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