Gift Acceptance Policy

Policy Purpose

The Institute for the Study of War (ISW) is a not-for-profit corporation and is tax-exempt under section 501(c)(3) of the Internal Revenue Code. Contributions to ISW are tax-deductible.

The purposes of this policy are to govern the acceptance of gifts, provide guidance to donors in completing gifts, and protect the interests of ISW and of donors. This policy is intended only as a guide. Flexibility within this policy is permitted in situations where it is considered appropriate by the President or, as directed by the President, the senior most Development Officer and Director of Accounting.

I. General Procedures

A. All gifts to ISW will be received by the Development team, which will record the terms and any restrictions or conditions of the gift. The Development team will send an acknowledgment to the donor. Pledges and gifts will be recorded, and a pledge payment reminder system will be maintained by the Development team.

B. Recordings shall be made in a manner that provides appropriate tax advantages to the donor. All contributions shall be made and accepted in compliance with Federal and State laws, as well as the Internal Revenue Code and regulations in effect at the time of the gift. Soft credit may be offered for recognition purposes, but ISW will only give legal credit to donors in accordance with IRS guidelines.

C. ISW will not give tax or legal advice to any donor under any circumstances. ISW will advise the donor to seek independent counsel prior to making a gift.

D. ISW reserves the right to decline any gift which is judged to be inconsistent with its needs or mission, or for which ISW’s resources are too limited to properly administer the gift.

II. Donor Identity

A. ISW cannot accept funding that originates from foreign governments, sovereign wealth funds, or individuals or entities that could present real or perceived conflicts of interest or otherwise compromise ISW’s independence and integrity.

B. ISW cannot accept contributions from sources whose identities are undisclosed to the organization but will respect the privacy of donors who wish to remain publicly anonymous. In the event that a donor elects to remain anonymous via a foundation, donor-advised fund, or other financial entity, agent, or vehicle, approval authority to accept said donation lies with the ISW President and will require a Memorandum of Understanding with the agent substantiating that the donor is not a foreign government or other high-risk entity as outlined above.

III. Gift Designations

A. Unrestricted – ISW encourages donations to be made without restrictions.

• Grants or gifts that have not been designated by the grantor or donor for a specific purpose shall be recorded as unrestricted donations.

B. Restricted — ISW also accepts restricted gifts to program areas designated by the President.

• Gifts to ISW cannot be restricted for the benefit of a specific individual (e.g., for an employee). However, gifts can support a position at ISW (e.g., to endow and/or name a fellowship or staff position).
• Restricted funds requiring expenditure by anyone other than the President will require approval in accordance with ISW policy.
• Gifts under $10,000 may not be designated as restricted and will instead be allocated as unrestricted funds, unless otherwise approved by the ISW President or, as directed by the President, the senior most Development Officer and the Director of Accounting.

IV. Types of Gifts

A. Endowed gifts

• ISW accepts gifts to establish an endowed fund for a purpose that is designated by the donor and which is acceptable to ISW. The fair market value of the gift must meet the minimum endowed fund level of $500,000. Other endowed fund levels may be determined according to the needs of ISW.

B. Cash gifts

• Gifts by cash or check shall be accepted by ISW regardless of the amount.
• Checks shall be made payable to Institute for the Study of War.
• Payment by credit card may be accepted subject to credit card company authorization requirements.

C. Securities

• Publicly traded securities may be accepted by ISW and may be sold immediately upon receipt, at the discretion of the Finance Department. The assigned value of the gift shall be the mean market value based on the gift date, in accordance with IRS guidelines. The donor is responsible for ensuring the accuracy of gift valuations for income tax purposes.
• Closely held securities, or securities not traded publicly, will not be accepted.

D. Cryptocurrency

• Gifts of cryptocurrency will not be accepted.

E. Real Estate

• Gifts of real estate will not be accepted. 

F. Gifts of tangible personal property

• Depending on the value of the gift, ISW may require an outside appraisal of the property before accepting it. Such gifts may be sold for the benefit of ISW.
• Generally, in-kind gifts and/or property required for ISW (meaning it would have been purchased if not donated) will be recognized at the fair market value of the gift. Gifts valued at $5,000 or higher will require a professional appraisal at the donor’s expense. The burden of appraisal and establishing the fair market value will rest with the donor, but ISW reserves the right to obtain an additional appraisal(s). ISW may provide gift valuation credit based upon information provided by the donor for amounts less than $5,000. ISW will acknowledge gift-in-kind receipt and sign IRS Form 8283, which the donor attaches to their tax return.
• Other donated property may be accepted upon approval by the President or, as directed by the President, the senior most Development Officer and Director of Accounting. Such gifts will be sold for the benefit of ISW. For ISW’s gift crediting and accounting purposes, the assigned value of the gift will be its realized sales price.
• Without information regarding gift valuation, or if there is no market for the property, the gift will be recorded with a value of one dollar ($1.00).
• ISW reserves the right to dispose of gifts of property at any time unless otherwise agreed to with a donor and will generally do so as soon as practicable after receipt. ISW adheres to all IRS requirements related to the disposal of gifts of tangible personal property and the filing of appropriate forms.
• Gifts of service are not considered tangible property.

V. In-Kind Gifts and Gifts of Service

A. ISW willingly accepts all appropriate in-kind/pro bono contributions of skilled services consistent with our mission, programs, and nonprofit status, in accordance with our established acceptance policies and procedures.

B. In-kind gifts may be accepted only upon assessment and approval by the President or, as directed by the President, the senior most Development Officer and Director of Accounting. In-kind gifts will be acknowledged with a thank you letter that does not specify the value of the gift but does state ISW’s tax identification number and nonprofit status.

VI. Pledges

A. A pledge is a written promise to make a contribution in the future. It is recorded as a contribution when there is demonstrable evidence that such a promise has been fulfilled.

B. The Development team tracks pledge commitments in a pledge reminder system maintained by the Development team.

C. Pledges may be payable in single, monthly, quarterly, semi-annual, or annual installments. Pledges will be payable over a period of up to five years, unless otherwise approved by the President or, as directed by the President, the senior most Development Officer and Director of Accounting (not to exceed 10 years).

D. Multi-Year Pledge Commitments

• Gift intent letters or pledge agreements must be provided in writing by ISW and signed by the donor for all multi-year pledge commitments. Conditional pledges, such as challenge gifts or gifts contingent upon reaching certain project benchmarks, may be counted in annual totals provided documentation of the pledge is submitted in the form of a pledge agreement and there is reasonable expectation that the conditions under which the pledge was made will be met.
• Gifts made from donor-advised funds may be attributed to an individual’s pledge, as per the Notice of Proposed Regulations (2017-73) from the IRS. The following conditions must be satisfied when attributing a DAF contribution to a pledge:
  • The sponsoring organization (e.g., Fidelity Charitable) cannot make any reference to the existence of a charitable pledge when making the distribution.
  • No donor or advisor may receive any benefit that is considered more than incidental because of the DAF contribution.
  • The pledge is not legally binding, and any written or oral statements that a DAF can be relied on for pledge payments would make the promise conditional.
  • Furthermore, a pledge agreement may not imply in any way that the responsibility for the pledge agreement lives with the sponsoring organization (in lieu of the individual). Therefore, pledge agreements will not include language that implies a personal pledge is contingent upon the sponsoring organization honoring the donor’s directions.

VII. Deferred/Planned Gifts

A. ISW accepts donations in the form of deferred and planned gift vehicles including but not limited to bequests, charitable remainder trusts, charitable lead trusts, charitable gift annuities, and gifts of retirement plans.

B. Donors and their legal advisors are encouraged to reference the legal name of ISW.

C. Donors who have indicated that they have established a deferred gift will be asked to document their intentions. Such information is for internal financial and recognition purposes and is not legally binding for the donor.

D. Proceeds of deferred gifts, unless otherwise designated by the donor, will be designated at the discretion of ISW.

E. Generally, ISW will not pay for expenses or the drafting of legal documents for a deferred gift. The President may approve such a request if circumstances warrant and if ISW is named as beneficiary of 55 percent or more of the remainder interest. Otherwise, the donor’s own legal counsel or professional advisor must review the documents at the donor’s cost.

F. For gifts of life insurance, a person may make a gift to ISW by naming ISW as a beneficiary or owner of a life insurance policy (whole, universal, and term). ISW prefers to accept paid-up policies that name ISW as both the owner and the beneficiary. ISW ownership of any life insurance policies should be reviewed by the President in consultation with the Board of Directors.

VIII. Charitable Gift Annuities

A. A donor may give ISW assets by which ISW contracts to pay an annuity to one or two designated beneficiaries for their lifetimes. ISW will follow the American Council on Gift Annuities’ suggested rates.

B. The general purpose of a gift annuity is to broaden the base of financial support. The following conditions must be met:

• The minimum initial contribution must be $10,000. Subsequent contributions may be in the amount of $5,000 or more.
• Permissible assets include only cash and publicly traded securities.
• There cannot be more than two beneficiaries of an annuity.
• Beneficiaries are recommended to be 65 or older to begin receiving payments.

C. ISW may consider serving as a co-beneficiary with another charity for a charitable gift annuity. If this applies to an accepted charitable gift annuity, ISW must be the beneficiary of more than half of the remainder (at least 55 percent).