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INTERNATIONAL GIVING BY INDIVIDUALS DURING LIFETIMEheld to be legally independent of the American church. Therefore, the individual’scontribution to the First Church of Christ, Scientist, Berne (Switzerland),was held not to be deductible. 12In another situation, however, the same court decided in favor of the Americandonor. In this instance, a school had been created in France under Frenchcorporation laws and had operated there for many years before incorporatingin Delaware. The IRS maintained that the U.S. corporation had no activitiesand was merely a shell created to attract tax-deductible American contributions.The Tax Court found that the organization was created in the UnitedStates by virtue of the Delaware incorporation. Further, the court observed thatthe organization did not distribute any of its funds to a foreign organizationoperating a school in France. Rather, the organization itself was found to beoperating the Paris school and applied contributions received toward operationof that school. This was sufficient to characterize the entity as a domesticcharity for U.S. law purposes, notwithstanding the school’s foreign origin. Theoperational nexus with the U.S. organization, even though essentially technical,was sufficient to distinguish the domestic organization from a mere shell(discussed below). 13The second of these two opinions is difficult to reconcile with the earmarkingand conduit restrictions discussed below. Application of the teachings of thiscase to any factual situation would have to be made with caution. 14§ 18.3 EARMARKING AND CONDUIT RESTRICTIONSAs discussed above, an American taxpayer who is an individual is not permittedto claim a federal income tax charitable deduction for a gift that flows directly toa foreign charitable organization, because of fundamental policies underlyingthe charitable deduction framework. Nonetheless, an American individual taxpayermay be permitted to make a contribution to an incorporated Americancharity that devotes some or all of its funds to overseas activities. The ability toclaim the deduction depends on the degree of control exerted by the Americancharitable organization and the lack of control imposed by the donor in directingthat the gift be applied to foreign charitable activities.Following a basic American tax law principle, deductibility of a contributiondoes not necessarily depend on its payment to a qualifying organization. If thegift is earmarked for a further destination, it is appropriate to look beyond theimmediate recipient (although a qualifying organization) to determine whetherthe payment is a charitable contribution that will bring an income tax deductionto the donor.In one instance, a court considered the question of whether amounts paid to afoster home for the care of a named individual were furnished for the use and12 Welti v. Commissioner, 1 T.C. 905 (1943). Subsequently, a charitable contribution deduction was denied for agift to a charitable organization in Burma (ErSelcuk v. Commissioner, 30 T.C. 962 (1958)); gifts to churchesin France (Herter v. Commissioner, 20 T.C.M. (CCH) 78 (1961)); a gift to an orphanage in Ecuador (Tobjy v.Commissioner, 51 T.C.M. (CCH) 449 (1986)); and a gift to an Islamic mosque in Iran (Alisobhani v. Commissioner,68 T.C.M. (CCH) 1493 (1994)).13 Bilingual Montessori Sch. of Paris, Inc. v. Commissioner, 75 T.C. 480 (1980).14 Further analysis of this body of law is in Tax-Exempt Organizations § 30.2(d). 550