Things to Consider
|
Fund with the Santa Fe Community
Foundation
|
Create a Private or Corporate
Foundation
|
|
Organization
|
Established 1981
|
Must establish
|
|
Tax Exempt
|
501(c)(3) Status
|
Must establish with IRS (6-8
months)
|
| Funds Required |
$25,000 minimum plus $250 set-up fee |
Experts recommend $10
million minimum |
| Selection of Grantees |
Donor, family or his/her
advisory committee
recommends grantees |
Donor specifies grantees |
| Tax Deductibility of Gifts |
a) Up to 30% of donor's
Adjusted Gross Income (50%
with cash donation)
b) Excess may be carried over
for five years
|
Limited to 20% of donor's adjusted gross income
(30% with cash donation) |
Federal Approvals, Restrictions,
and Special Taxes |
a) Approved by IRS
b) No payout requirement
c) No federal excise tax |
a) Must receive IRS approval
b) IRS requires 5% of assets to
be paid out annually
c) Fund is charged 2% federal
excise tax on income unless
strict requirements are met
d) Greater incidence of IRS
field audit |
Legal Documents for Creation
of Foundation, Designation of
funds and Grant Awards |
In place |
Must create |
| Office |
In place |
May need to obtain |
| Staffing |
In place |
May need to obtain |
| Accounting |
In place |
Must obtain |
| Tax Return (state and federal) |
Foundation reports |
Must prepare |
| Public Report |
Report to public made
annually if desired by donor |
Must prepare reports for the
general public |
Knowledge of Potential
Grantees |
Provided by Community Foundation |
Must develop |
Grant Evaluation Process to
Ensure Donor's Intent
Satisfied |
Community Foundation
develops, if desired by donor |
Must develop |
| Grants |
Not limited to 5% |
Grants must be at least 5% in order to
avoid 2% tax rate |
| Public Recognition for Donor |
Fund may be named or
anonymous - SFCF publicizes
grants made from funds,
if desired |
Must provide or rely on
grantee organization |
Director/Officer Liability
Insurance |
In place |
Must obtain |
| Investment of Assets |
Finance Committee oversees
investment policies. Donor
may recommend an
investment manager
for invested funds over $1 million.
|
Must establish policies and
select investments |
| Organization Overhead |
1.5% fee on first $2 million;
1% from $2 - $5 million;
.5% over $5 million |
Substantial costs; plus 2%
federal excise tax on income |