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INTRODUCTION
Charitable giving has long been a humanitarian and philanthropic arm of estate planning for persons of substantial means. As economic and cultural globalization proceeds apace, charitable giving also increasingly takes on an international complexion because more and more families are establishing personal and financial ties with countries and even continents beyond the borders of their ancestry and original heritage. The events of September 11, 2001, however, as in so many other areas of life, have cast a new perspective on the phenomenon of transnational charitable giving, as investigations of the financial support for terrorist activities have discovered that funds provided by some charitable foundations and entities in the Middle East and even some in the United States may have been used for these activities. These discoveries have already precipitated a legislative response, under the USA PATRIOT Act, that brings potential adverse U.S. immigration consequences for U.S. non-citizen residents who make unwise international charitable donations. Whether legislative attention will also be brought to bear on the U.S. tax benefits of gifts to charitable non-profit and charitable organizations and projects abroad and at home remains to be seen. For now, as described in more detail in this article, the U.S. Treasury Department and the Internal Revenue Service have made the grant-making procedures of charitable organizations that support foreign charitable activities their primary focus.
The rules regarding the tax deduction available for contributions to foreign charitable entities and programs are already complicated, and careful attention must also be paid to the tax rules affecting the foreign charitable activities of U.S. charities, particularly private foundations. The enactment in 1996 of legislation defining and regulating foreign trusts added an additional layer of complexity to the applicable rules regarding foreign charitable trusts. This article begins with a detailed analysis of the "players" in the field of international charitable giving and then proceeds to discuss the issue of U.S. tax deductibility for charitable giving under the income tax and transfer tax systems, the special rules applicable to foreign charitable trusts, the U.S. tax treatment of foreign public charities and foreign private foundations, and the special rules governing foreign charitable activities of U.S. private foundations. A brief discussion of the current focus on the grant-making procedures of U.S. charitable organizations that...