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INTERNATIONAL GIVING BY INDIVIDUALS DURING LIFETIMEallocate contributions—within the discretion of the board of directors—to anyorganization organized and operated exclusively for charitable or educational purposeswithin the meaning of the U.S. tax law. The board of directors exercisedeffective review of the project before approving any funding. The board monitoredthe foreign distributing organization’s ongoing adherence to the domestic charity’sgoals. Notwithstanding that the donations were technically “earmarked,” thedomestic organization demonstrated that it exercised full control over the donatedfunds and retained substantial responsibility as to their use. These standards entailmore than merely being able to decide whether to contribute and being able torequire the foreign recipient to furnish a periodic accounting. In its decision, theIRS referred to an earlier ruling holding that, when gifts to a charitable organizationwere not earmarked by the donor for a particular individual, the deductionwould be allowable if it was established that a gift was intended by the donor forthe use of the organization and not actually as a gift to a specific individual forwhose benefit the gift would be used by the donee organization. 26 The test, said theIRS, is whether the organization retains full control of the donated funds to ensurethat they will be used to carry out the organization’s own charitable purposes.The conclusion in another IRS pronouncement was that, because the trusteesof the subject organization were unable to state that all the funds would be usedin the United States, they did not have sufficient control and discretion over theuse of any contributions made to foreign distributees. 27 The problem in this casewas that the domestic organization did not seem to have any formal operatingsystem by which it could control the selection of projects to be funded—they hadno means of effective supervision over the use of the funds for a project, nor theability to withhold or control the funds once committed. In this regard, the IRSconcluded that it appeared that the domestic organization was intending toremit the monies to the foreign distributee before even considering possibleprojects and then discussing with the foreign organization the possible uses ofits funds. Thus, the operating procedures and inability of the domestic organizationto supervise the use of funds by the foreign organization did not evidencethat degree of control and discretion required under the law. 28The IRS presented another analysis of the control and accountability requirement.29 This ruling discussed a domestic charity formed to address the problem ofplant and wildlife ecology in a foreign country through programs that includedgrants to foreign private organizations. The domestic charity maintained controland responsibility over the use of any funds granted to a foreign organization byfirst making an investigation of the purpose to which the funds were to bedirected; by then entering into a written agreement with the recipient organization;and ultimately by making site visits to see that the agreement was being followed.Any foreign organization that received financial assistance from thecharitable organization had to be organized and operated in a manner analogousto a U.S. tax-exempt charitable organization and be completely independent offoreign governments. The charitable organization exercised accountability for the26 Rev. Rul. 62-113, 1962-2 C.B. 10.27 Gen. Couns. Mem. 37444.28 Reg. § 1.170A-8(a)(1).29 Rev. Rul. 75-65, 1975-1 C.B. 79. 554