Q&A's Archive - Page 2 of 38 - Exponent Philanthropy

Q&A Archive

How do board policies work?

Board policies work in tandem with a foundation’s bylaws or trust document to create the foundation’s structure. Bylaws or the trust document are legally binding and based in state law; policies are also considered binding, but they are less likely to be backed by force of law and are easier to amend (e.g., usually by... Read More

Foundation administrative expenses; what’s important to know?

From a tax law perspective, a private foundation may pay “reasonable and necessary” administrative expenses. These also count toward its annual distribution requirement, without subjecting the foundation or its managers to a penalty tax. Administrative expenses must be (a) related to the accomplishment of the foundation’s charitable purposes, (b) related to its investments, or (c)... Read More

We’re considering setting up a scholarship program. Got any tips?

Private foundations that want to have a scholarship program—and do the work of publicizing the program, reviewing applications, choosing winners, and monitoring awards—must get prior approval from the Internal Revenue Service. This one-time review ensures that you award scholarships (or other grants for study, travel, or similar purposes) in an objective, nondiscriminatory way. Without IRS... Read More