[A] mounts paid or allowed to, or on behalf
of, an individual to enable him to pursue studies or research are considered to be amounts received as a scholarship or fellowship grant for the
purpose of section 117 if the
primary purpose of the studies or research is to further the education and training
of the recipient in his individual capacity and the amount provided by the grantor for such
purpose does not represent compensation or payment for the services described in subparagraph (1)
of this
paragraph.
Unfortunately, with the general insatiable desire to reduce taxation, many taxpayers and tax advisors alike have veered from the true
purpose of Trusts (see first
paragraph) and blindly pursue the Conduit - Principle as the sole or
primary reason for using Trusts.