As a private foundation, you are required to make the following documents available to the public: Form 990-PF, the annual information return filed with the Internal Revenue Service (IRS), for the 3 most recent years Form 1023, the application for federal tax-exempt status (and all related correspondence with the IRS) Form 990-T, the unrelated business... Read More
In today’s litigious society, anyone—including your foundation and the individuals associated with it—may be the target of a lawsuit. Although state and federal laws may provide some protection for your board members and volunteers, this immunity will extend to your organization in only a few states. These laws often contain no protection for legal expenses,... Read More
The best protection against audit problems is to know the Internal Revenue Service (IRS) rules and keep good records. The interest and dividend statements, canceled checks, and so forth that back up your return should be kept with the return. A typical foundation IRS audit notice requests that the following records be made available: Organizing... Read More
Amounts that foundations set aside or save for specific projects may be treated as current qualifying distributions. To qualify, the foundation must satisfy the Internal Revenue Service (IRS) rule that the amount set aside for a specific project be paid out within 5 years, and that the set-aside amount is appropriate because the project can... Read More
Private foundations are subject to a range of legal regulations. The following list is not comprehensive but provides a sense of the scope of laws that apply to private foundations. Laws that apply to private foundations and public charities General legal requirements Fiduciary duties Conflicts of Interest Private inurement and public benefit Records and disclosures... Read More
In 1964, Congress enacted mandatory distribution rules to prevent private foundations from receiving gifts and investing the assets—yet never spending funds for charitable purposes. Congress thought it unfair to allow a charitable deduction when, in some cases, funds were not being directed to charity. A private foundation must make annual charitable expenditures, called qualifying distributions, equal... Read More