Showing posts with label charitable foundation. Show all posts
Showing posts with label charitable foundation. Show all posts

Friday, July 10, 2009

Setting Up Your Charitable Foundation

A private family foundation is a wonderful way to teach and expose your family to charitable giving. At an early age, members of your family can participate in the operations of the foundation and suggest worthy charities or charitable causes. The foundation can carry out the family legacy throughout the generations.

Once you decide that you want to establish a family foundation, you will need to decide how to structure it. A foundation can be set up as a trust or a non-profit corporation. Although there are fundamental differences between a trust and a corporation, both structures can be set up quickly and for similar costs. The corporate structure will involve some filing fees with the Secretary of State, but nothing extraordinary.

The governance of the private family foundation differs depending on whether it is a corporation or a trust. Under the trust approach, the trustee or trustees will make decisions subject to instructions in the trust agreement. The corporation will be run by its officers and a board of directors. The corporate structure may provide more flexibility in future changes to the charitable goals of the family foundation. If the foundation is being established by one person who wants to maintain a set charitable mission even after he/she is gone, the trust may be a better approach.

Regardless of how the family foundation is structured, it is an excellent opportunity to pass along the family legacy.

Wednesday, April 22, 2009

Is The Family Foundation Giving Way to The Donor-Advised Fund?

A charitable family foundation can be much more involved than a donor-advised fund.  It is important to understand a client’s expectations before recommending one or the other.  A recent Wall Street Journal article, Family Charities Shift Assets to Donor Funds, provides a few recent examples where foundations were dissolved in favor of donor-advised funds.  In reading the examples provided, the underlying theme seemed to be that the donor-advised fund was easier and much less time-consuming.

 The Columbus Foundation’s website discusses the advantages of the donor-advised fund versus the private foundation.  If you look at the list of these advantages, it is clear why the donor-advised fund is easier to establish.  Additionally, one nice thing about the donor-advised fund is that it can be set up with as little as $10,000.  It is not cost-effective to set up a family foundation with that amount.

Monday, December 01, 2008

Quote of the Day

"You can't give what you haven't got"
- Maurice "Hank" Greenberg, former chief executive of AIG, explaining why charitable gifts from his foundation will be few and far between. Big Players Scale Back Charitable Donations, The Wall Street Journal Greenbergs family foundation's assets declined from $47.7 Million in February to about $4 Million in October.