Schedule C. Advance Approval of Individual Grant Procedures Described in Section 4945(g)

A private foundation’s grant to an individual for travel, study, or similar purposes is generally a taxable expenditure unless the foundation obtains advance IRS approval of its grant procedures.

The 45th day after a request for approval of grant procedures has been properly submitted to the IRS and the organization has not been notified that such procedures are not acceptable, such procedures shall be considered as approved from the date of submission until receipt of actual notice from the IRS that such procedures do not meet the requirements of this section. If a grant to an individual for a purpose described in section 4945(d) (3) is made after notification to the organization by the IRS that the procedures under which the grant is made are not acceptable, such grant is a taxable expenditure under this section.

For more information about advance approval of grant-making procedures of a private foundation, go to IRS.gov/Charities-Non-Profits/Private-Foundations/ Advance-Approval-of-Grant-Making-Procedures .

Line 1. Check the appropriate box(es) indicating under which section(s) you want your grant-making procedures to be considered.

Check the box for “4945(g)(1)” if the purpose of your award is to provide a scholarship or fellowship grant that is awarded on an objective and nondiscriminatory basis and is used for study at a school.

Check the box for “4945(g)(3)” if the purpose of your award is to achieve a specific objective; produce a report or other similar product; or improve or enhance a literary, artistic, musical, scientific, teaching, or other similar capacity, skill, or talent of the recipient. Include your educational loan program under this section.

You may check more than one box. If your prizes or awards are not intended to finance a future activity of the recipient and impose no conditions on the recipient as to how they may be spent, you do not have to request advance approval of your grant-making procedures for such prizes or awards because such a prize or award is not a grant for travel, study, or other similar purposes. See Rev. Ruls. 77-380, 1977-2 C.B. 419; 76-460, 1976-2 C.B. 371; and 75-393, 1975-2 C.B. 451.

Line 2. If you conduct more than one grant program, describe each program separately.

If you make educational loans, describe the terms of the loan (for example, the factors you consider in selecting or approving loan recipients, interest rate, duration, forgiveness provision, etc.). Also, describe whether any financial institutions or other lenders are involved in your program.

Explain how you will publicize your program and whether you publicize to the general public or to another group of possible recipients. Include specific information about the geographic area in which your program will be publicized and the means you will use, such as through newspaper advertisements, school district announcements, or community groups.

Line 3. Organizations that make grants to individuals must maintain adequate records and case histories showing the name and address of each recipient, under Rev. Rul. 56-304, 1956-2 C.B. 306, but don’t provide this information as part of your application.

Line 9. If “Yes,” enter what measures you take to ensure unbiased selections and that awards are not provided to disqualified persons.

Note: As a private foundation, you are not permitted to provide grants to disqualified persons. Disqualified persons include your substantial contributors, foundation managers, and certain family members of disqualified persons. Section 4946(a)(1) defines the term “disqualified person” as a person who is:

A. A substantial contributor, as defined in section 507(d)(2) (generally, a person who has contributed or bequeathed more than 2% of your total contributions and bequests received, if over $5,000); B. A foundation manager (within the meaning of section 4946(b)(1)); C. An owner of more than 20% of (i) the total combined voting power of a corporation, (ii) the profits

8 Instructions for Form 8940 (Rev. 12-2025)

interest of a partnership, or (iii) the beneficial interest of a trust or unincorporated enterprise, which is a substantial contributor to the foundation; D. A member of the family (as defined in section 4946(d) (spouse, ancestors, children, grandchildren, great-grandchildren, and spouses of children, grandchildren, and great-grandchildren)) of any individual described in subparagraph A, B, or C; E. A corporation of which persons described in subparagraph A, B, C, or D own more than 35% of the total combined voting power; F. A partnership in which persons described in subparagraph A, B, C, or D own more than 35% of the profits interest; or G. A trust or estate in which persons described in subparagraph A, B, C, or D hold more than 35% of the beneficial interest. Section 4946(b) defines the term “foundation manager,” with respect to any private foundation, as an officer, director, or trustee of a foundation (or an individual having powers or responsibilities similar to those of officers, directors, or trustees of the foundation).

Line 10. Answer “Yes” if you will:

1. Arrange to receive and review grantee reports annually and upon completion of the purpose for which the grant was awarded;

2. Investigate diversions of funds from their intended purposes upon having reason to expect such diversions (including failure to receive required reports); and

3. Take all reasonable and appropriate steps to recover diverted funds, ensure other grant funds held by a grantee are used for their intended purposes, and withhold further payments to grantees until you obtain grantees’ assurances that future diversions will not occur and that grantees will take extraordinary precautions to prevent future diversions from occurring.

Line 11. Answer “Yes” if you will maintain all records relating to individual grants, including information obtained to evaluate grantees, identify whether a grantee is a disqualified person, establish the amount and purpose of each grant, and establish that you undertook the supervision and investigation of grants described on line 10.

Line 12. Answer “Yes” if you award scholarships on a preferential basis because you require, as an initial qualification, that the individual be an employee or be related to an employee of a particular employer, or because you give preference or priority to such persons.

Line 15. For purposes of this schedule, a program for children of employees of a particular employer includes children and other family members of employees.