Getting Started
Community Foundation
- The Community Foundation has been around since 1972.
- Setting up a fund is easy and inexpensive.
- There are no initial tax filing requirements.
- There are no necessary corporate documents.
Private Foundation
- A foundation must be started from the ground up.
- Can be costly and time-consuming.
- Requires filing with the IRS to receive tax-exempt status.
- Must establish a separate corporation or trust.
Administration
Community Foundation
- Costs are shared by all funds.
- Knowledgeable and professional staff.
- Board who are informed of community needs.
- Investments are managed by a responsible committee and investment managers.
Private Foundation
- Various costs for administration, insurance, accounting and audit.
- Must obtain knowledge of community needs.
- Requires research for managing
investment vehicles.
Tax Benefits*
* subject to change by the IRS. Not intended to be tax advice. Always speak with your advisor when considering tax implications.
Community Foundation
- Cash gifts are deductible up to 50% of adjusted gross income.
- Full market value of appreciated assets is deductible up to 30% of adjusted gross income.
- Tax-exempt income.
- The Community Foundation handles filing Form 990
Private Foundation
- Cash gifts are limited to 30% of adjusted gross income.
- Full market value is deductible limited to 20% of AGI or tax cost basis is deductible limited to 50% of AGI.
- Tax-exempt income but may be subject to excise tax of up to 2% of net investment gains. Must prepare Form 990-PF.
Donor Control
Community Foundation
- Donor may make recommendations regarding distributions.
- Donors may remain anonymous.
Private Foundation
- Donor retains control over investments and distributions.
- Donor information is open to the public for up to three years.
