[Foundation-l] Update of the Gift Policy

Tue Jan 22 02:48:07 UTC 2008

Gerard Meijssen wrote:
> I am sorry I do not understand. What is an "applicable tests for public
> support". Why are donations from other charities exempt.
Brad Patrick wrote:
> The idea is that other non-profits (large foundations, for example) should
> be free to support the mission of the organization, but are obligated to the
> same standards under the US code.  Is there a difference between the Gates
> Foundation giving $ versus Bill Gates, individually, or Microsoft, as a
> company?  The government thinks so.  The point of the gift policy is to put
> the consideration of such gifts in the sound discretion of the Board.  Now
> the policy is explicit.
>   
I think Brad has the substance right, but I'd like to address one detail 
that may clear up some of the confusion. As has been mentioned, the 
tests are covered by IRS regulations, and a good deal of the language 
consists of terms of art drawn from those regulations. If you want to 
read up on all the details, you're welcome to look at IRS Publication 
557. http://www.irs.gov/pub/irs-pdf/p557.pdf (PDF)

Some of the discussion has assumed that donations from other charities 
are generally exempt, but the policy actually refers to "other publicly 
supported charities" (an important qualifier). This means the exception 
is not for any donation from another charity, but only from another 
charity that meets the same requirements as the Wikimedia Foundation. 
Essentially, the IRS treats the public support test as transitive, and 
that test is what the resolution is mostly about. I assume the Gates 
Foundation does not try to meet the public support test, but operates as 
a private foundation (also a non-profit, but of a different type). So 
the hypothetical donation from Bill and a grant from his foundation 
would actually be treated the same under this policy.

--Michael Snow