Tuesday, October 11, 2016
There are several issues one must consider when making gifts to charity, specifically the disadvantaged. For individuals making grants to private foundations for those in need of travel, study, or related purposes, the IRS must approve the grant procedure in advance. Further, the recipients must make up a charitable class and be selected in an objective, non-discriminatory manner without creating improper benefits. For this purpose, it is wise to maintain documentation and develop a grant application. On the other hand, for those wanting to personally provide for disadvantaged individuals, the solution might simply be to make an outright gift. This solution is often tax-efficient and free of deduction.
See Jennifer M. Pagnillo & Avery B. Armas, Best Practices for Charitable Gifts to Individuals, Wealth Mangement, October 5, 2016.