Gifting Someone Money to Make a Donation - Step Transaction

[spartan7886]

A relative of ours recently passed away, and a scholarship was created in her name. Closer relatives have recently discovered they can increase the amount of money they get by writing a check to someone who has a matching gifts program at work to then write a check to the charity and have the donation basically doubled. Setting aside the moral implications as regards the company, would taking the tax deduction run afoul of the IRS as a step transaction (for one who will be itemizing)? Assume most of the people doing this would be writing a check anyway, but now it's just bigger. 

I see four possible courses of action.

1) Decline to participate. Company retains match, individual no change, charity loses potential donation, IRS gets money.
2) Participate, but ask for reimbursement of net donation after deduction. Company pays match, individual no change, charity obtains maximum donation, IRS gets less money.
3) Participate, and get fully reimbursed. Company pays match, individual gets deduction, charity gets match, IRS gets less money.
4) Participate, and only deduct part of donation that would be made without reimbursement. If audited, and deduction is less than charity receipt, will this cause a problem? Company pays match, individual no change, charity gets match, IRS gets money.

[Deleted]

I think you are complicating things? 

The biggest issues are 

1) The person gifting money loses the deduction. (Although the person getting the gift gains the deduction if they follow through)

2) The person getting the gift may choose not to actually follow through and just keep the money, as is their right. 

[spartan7886]

I'm a little worried that they're taking donations to the scholarship written before the 501c3 was fully formed and recycling them, which would be two deductions of the same money, but I think you're right if it's just stuff like the proceeds from the sale of her truck. 

[mwcpa]

the person who gives another person money so the first person can make a charitable gift does not get credit for the charity. the original giver must maintain records that they made a gift, including, but not limited to, proof of payment and an acknowledgement from the charity in writing.