C.14. Supervision — Publication 5590

(1) Pertaining to scholarships and fellowships paid directly to the individual grantee, a

grantor private foundation must arrange to receive a report of the courses taken at an educational organization and grades received by the grantee. The report must be verified by that educational organization and be obtained at least once per year. If no courses are taken (for example, the grantee is preparing a research paper, project, or doctoral thesis), the grantor private foundation must receive an annual progress report that has been approved by the faculty member supervising the grantee or an appropriate university official. A final report is also required upon the completion of the grantee’s study at the educational organization. See Treas. Reg. 53.4945-4(c)(2). Special rules apply for scholarship and fellowship grants paid to educational organizations—see Treas. Reg. 53.4945-4(c)(5).

(2) With respect to other types of Section 4945(d)(3) grants, the private foundation

must require an annual report on the use of the funds and the progress made by the grantee toward achieving the purposes for which the grant was made. A final report describing the grantee’s accomplishments and accounting for the funds

received is also required upon completion of the project. See Treas. Reg. 53.4945-4(c)(3).