Indeed, NO. There most definitely is full expectation and accountability for the student to perform the proposed work overseas. All of the $10,000 is to be precisely accounted for in a detailed report following conclusion of the project at the end of the summer. It sounds, though, as though the IRS has no particular separate consideration for such awards.
Furthermore, these students, though young, are adults - not children. (I have in my life only run across a small handful of college students who are under the age of 18 - and none who have received this award!) And too, they have been rigorously selected from a competitive pool of applicants based on a list of requirements including the writing of a deeply-researched proposal that includes a full budget detailing the spending every dollar of the award specifically on the vetted project. In the past, our students have used these awards to do a wide variety of things - most recently, to build a community space for disabled children in a war-ravaged area. This is the first year wherein our office has decided not only to assist students in applying for the award, but also understanding the tax implications - a service that, honestly, is far overdue.
I will continue to seek input on this topic, and I note that it does sound like the award is taxable, but I wanted to clarify that in no way, shape or form is this "free money" for anyone. Of note, the student is responsible for returning any unspent money to the foundation, if they cannot otherwise account for it in their summer-end report. Thank you for your thoughtful feedback, though - it's been helpful to dive deeper into the details that we need to consider.
