Deductibility of Grants, Bequests and Donations

October 11, 1960 BIR RULING NO. 444-60 Mr. Antonio Isidro Vice-President for External Studies University of the Philippines Quezon City S i r : Reference is made to your letter of the 26th ultimo, stating that University and the U.P. Scholarships Foundation, Inc. plan to conduct a campaign to solicit gifts and donation "for scholarships in the University which may be awarded to brilliant and promising youths of the country". You now request information whether the grants, bequests and donations mentioned in section 23 of Republic Act No. 2067, otherwise known as the Science Act of 1958, may be deducted in full from the net income of the grantor or donor, for purposes of income tax, notwithstanding the limitation on the matter of deduction donations imposed in section 30(h) of the National Internal Revenue Code. You also wish to be informed regarding the requisites prescribed by this Office in order that said grants, bequests and donations may be entitled to deduction. In answer thereto, I have the honor to inform you that grants, bequests, and donations made or given to the University, are deductible in full from the net income of a taxpayer, provided that the same are made or given for either of the purposes stated in section 23 of Republic Act No. 2067. As the Foundation is not covered by this law, donations thereto are deductible only to the extent allowed under Section 30(h) of the National Internal Revenue Code. In order to enjoy the benefit of such deduction, the taxpayer should state in his income tax return the name and address of the recipient of the gifts and the respective dates and amounts thereof. In the case of gifts other than money, the basis for calculation of the amount thereof shall be the fair market value of the property at the time of the gift. The taxpayer should also attach to his income tax return a certificate duly signed by a responsible officer of the recipient, attesting to the fact that the latter had received the gifts on the respective dates and in the amounts appearing therein and that the same are for either of the purposes mentioned in said section 23. aisadc Very truly yours, MELECIO R. DOMINGO Commissioner of Internal Revenue