Is Converting Your Foundation to a Donor-Advised Fund Right For You?
This survey can help you determine if a donor-advised fund account makes sense for you. Whether you want to convert your private foundation to a donor-advised fund account or are considering one as a complement to your foundation, Schwab Charitable can help.
There are both benefits and consequences associated with the degree of privacy surrounding charitable giving. Some donors want their giving to be public because they feel that it may act as a catalyst for others' gifts and/or they enjoy the benefits to their personal and professional reputation. Others place a premium on their privacy. They may want to avoid conclusions drawn about their implied wealth, avoid being solicited for additional grants or have safety concerns for their families. They may also want to reduce speculation about their values or lifestyle based on the causes they support.
Private foundations are required to complete an annual filing called a 990-PF. This contains comprehensive information about the foundation, including names of directors and officers, contributors and the amount of each contribution, revenue and expenditures of the foundation and a list of all grant recipients and amounts. Copies must be furnished to the attorney general in each state in which the private foundation is registered. The foundation must also make the 990-PF available to the public. This requirement is usually met automatically by on-line providers that publish all private foundation tax returns from the IRS, making private foundation filings accessible via the internet.
Individual donor-advised fund accounts do not file an annual IRS return. Instead, the donor-advised fund sponsor files an aggregated return. As such, the specific transactions and donor names associated with a donor-advised fund account may be kept private. Limited donor information is provided to the IRS for exceptionally large contributors only. Donors may also choose to be recognized or to give anonymously to charities for each grant they make.
1. A donor-advised fund is likely the more appropriate charitable vehicle for you because it offers more privacy.