Direct charitable activities (DCAs) are those in which the foundation maintains some significant involvement, rather than simply awarding a grant to a recipient that carries out the activity. Examples include: Conducting educational seminars and conferences Providing goods, shelter, or clothing in which the foundation maintains some significant involvement (e.g., the distribution or delivery of the... Read More
To prevent certain abuses that could stem from allowing a nonprofit to control a for-profit enterprise (e.g., propping up stock prices), private foundations are prohibited from owning more than a small portion of any business enterprise. Specifically, the Internal Revenue Service prohibits a foundation, together with its disqualified persons, from holding more than a 20%... Read More
Expenditure responsibility requires private foundations to: Take steps to ensure that grants to certain organizations are spent only for the charitable purposes for which they were made. Obtain full and complete reports from the grantee on how the funds were spent. Make full and detailed reports on the expenditures to the Internal Revenue Service (IRS).... Read More
The easiest way to fund international causes is to use a U.S.-based intermediary or aid organization that has networks in foreign locations. Those organizations specialize in giving abroad and can redistribute funds effectively to meet specific needs. Not only may the grant be more effective because of the organization’s connections but foundations avoid the additional... Read More
A key to completing or reviewing the Form 990-PF is to have the required source documents available and organized before you start—even if you are hiring someone to complete the form for you. Categorizing expenses For easier access to what you need, it can be helpful to categorize expenses throughout the year as follows: Administration... Read More
In 2008, the Internal Revenue Service (IRS) significantly revised Form 990, the information return filed by public charities, and focused portions of the revised form on public charities’ governance. Although few governance issues raised by the IRS reflect actual legal requirements, the IRS has had the presumably intended effect of leading many public charities to... Read More