| Feature |
Private Foundation |
Support Foundation |
Community Foundation Donor-Advised Fund |
| Control |
Donor retains maximum control of board, investments, and grantmaking. |
Donor names a minority of the board, which controls investments and grantmaking. |
Donor provides advice to Community Foundation board on grants, resulting in practical, if not legal, control of grants. Must adhere to Foundation investment policy. |
| Self-dealing rules |
Strict regulations prohibit most transactions between a private foundation and its donors (including related persons or corporations). |
Private foundation self-dealing rules do not apply. |
Private foundation self-dealing rules do not apply. |
| Tax Deductibility |
(AGI = Adjusted Gross Income)
Property: 20% AGI
Cash: 30% AGI
|
Public charity deductibility – market value
Property: 30% AGI
Cash: 50% AGI |
Public charity deductibility – market value
Property: 30% AGI
Cash: 50% AGI |
| Excise taxes |
Excise taxes
(Section 4940-4945)
1%-2% of invest. income |
Exempt from excise taxes |
Exempt from excise taxes |
| Minimum payout requirement? |
Yes 5% |
No |
No |
| Investment Flexibility |
Must divest excess business holdings (closely held stock) within five years or pay excise tax. |
Can hold assets that do not conform to Community Foundation’s investment policy |
Foundation offers donors limited number of investment strategies.
|
| Continuity |
Can continue to future generations. |
Can continue to future generations. |
Donor may name a successor advisor(s) to his or her fund. |
| Administration |
Burdensome administration:
- Accounting
- Record keeping
- Tax return (form 990-PF)
|
Less burdensome:
- Board minutes
- Tax return (simple form 990)
|
Simple:
- Can establish in one day
- No separate tax returns required
|
| Liability & Risk Insurance |
Must be purchased by the private foundation. |
Provided by the Community Foundation up to $10 million |
Provided by the Community Foundation up to $10 million. |
| Staff |
Can employ family members. |
Can employ family members. Access to Community Foundation staff |
Access to Community Foundation staff (for investment, grantmaking expertise). |
| Start-Up costs |
Legal and accounting fees |
Less than a pf |
None |
| Converting between entities |
Can convert to a supporting foundation or donor-advised fund. |
Can convert to or from a donor-advised fund, or from a private foundation.
|
Can convert to or from a supporting foundation, or from a private foundation. |
