Do any of our peer community foundations grant scholarships internationally? If so...

katiekuehl

1. What should we be aware of when establishing a scholarship for international students/universities? Note: This would be an employer scholarship for dependents of international employees.
2. What IRS guidelines are you using to govern your work?
3. Are there particular nuances with the application, selection, or grant process for these scholarships?

Anything else we should know?

Thanks for your input!

KaraAdams (Former Community Manager)

Hi @katiekuehl! Great questions! I've featured your discussion in some of September's newsletters to see if any other Compass members can share their experience with you!

LauraMalone

Hi @katiekuehl. I hope you are doing well.

We looked into this for a local employer about 2 years ago and were advised by counsel well versed in this matter that we should direct the company to work directly with the IRS to create a scholarship program for their employees. There are a lot of unique IRS nuances when the donor (company) is limiting the pool of candidates to employees. I think I also recall some connection/concern as to if the scholarship would/would not be viewed as employee compensation to the parent of the recipient. I would imagine that nuance would be even more precarious when you are dealing with international employees.

If we wanted to be engaged as the community foundation, we were advised the scholarship would need to be open to the community at large (employees can participate, but cannot be favored in the process).  The employer could select the core selection guidelines but could not participate in candidate selection.

I would be curious to hear anyone else's thoughts.

Have a great weekend.

Laura

LisaBoxWilliams

Bonjour from New Orleans! We are a family foundation that provides scholarships to dependents of employees in the USA and in 7 additional countries. The employees work for companies owned by the trustees of my foundation. I have a separate Foundant account that manages the scholarships and keeps them separate from the Foundation gifts.

@LauraMalone you are correct it is an IRS 8940 Request for Miscellaneous Determination. It takes time to get it set up, but it is possible, and the employees love it. We have been doing scholarships for 20 years in the US and applied to the IRS for the ability to fund internationally. I just finished my first grant international cycle.

I am happy to share details with you, including an attorney with international scholarship expertise.

lisa@goldringfoundation.com

katiekuehl

Thanks @LauraMalone and @LisaBoxWilliams! This information is helpful for us.

JennyCampbell

@katiekuehl Did you come to a solution to your question about granting scholarships to international schools? We periodically have an U.S. student be awarded a scholarship and then tell us they are attending an international school. Wondering if you can break down the legalese for your process.

katiekuehl

Hi @JennyCampbell , We reached the conclusion that it we didn't have the bandwidth for the additional administrative burden. We didn't dive too deep on whether or not it would require equivalency determination to grant to those international schools or what the associated costs would be.

Even the largest of foundations that we interviewed during our research outsourced (or didn't offer) international scholarships. Scholarships America was the vendor that a few we talked to are using to manage their international scholarships.