A virtual bench trial that began on October 19 may soon further define the contours of control issues surrounding donor-advised funds. The case, Fairbairn et al. v. Fidelity Investments Charitable Gift Fund, centers on a feud between donors Emily and Malcolm Fairbairn and Fidelity Investmentâ€™s Charitable Branch.
The tainted donor dilemma is nothing new; nonprofits have long wrestled with the ethical and reputational implications of receiving questionable characters’ gifts. Â But with the explosion of real-time mass communication and social media, stories of wrongdoing are quickly amplified and can quickly sink a person–and everything and everyone with whom they are associated.
Not every contribution to a charity qualifies for a charitable deduction. Charities that misunderstand the rules can lead donors astray when they offer tax receipts for non-deductible gifts inadvertently damaging donor relationships.