Family Foundation Plus℠ vs. Private Foundation

Through The Dayton Foundation’s Family Foundation Plus, you can have the advantages of a private foundation, avoid the disadvantages, and gain the benefits and resources of a well-respected community foundation. This service can help you preserve and wisely utilize your resources for the charitable purposes you or your family care about the most.

The following chart compares the advantages of establishing a Family Foundation Plus fund vs. a private foundation.

To learn if a Family Foundation Plus fund is right for you, your family, or your client, contact a member of our Development team, at (937) 222-0410.

Download a print-friendly version of the Family Foundation Plus vs. Private Foundation chart.

HOW THE DAYTON FOUNDATION’S FAMILY FOUNDATION PLUS COMPARES TO A PRIVATE FOUNDATION

    •  
    • Family Foundation Plus (FF+) Fund
    • Private Foundation (PF)
    • 1. Legal Entity
    • Established by The Dayton Foundation Plus, Inc., an organization that supports The Dayton Foundation
    • Must be established by PF
    • 2. Application for Nonprofit Status (IRS Form 1023)
    • Done
    • 501(c)(3) must be obtained from IRS
    • 3. Tax Status
    • Public charity
    • Private foundation
    • 4. Valuation of Gifts, Other than Publicly Traded Stock
    • Fair market value
    • Cost basis
    • 5. Limitations on Tax Deductibility of Donations
    • 50% of Adjusted Gross Income (AGI) for cash gifts; 30% of AGI for long-term capital gains assets
    • 30% of AGI for cash gifts; 20% of AGI for long-term capital gains assets
    • 6. Taxes Paid
    • None
    • 2% excise tax on net investment income, possible penalty taxes
    • 7. Tax Returns, States & Federal
    • Separate fund report not needed. Donor’s privacy can be protected, if desired.
    • Federal 990-PF filed by PF. Grant history open to public inspection.
    •  
    • Family Foundation Plus (FF+) Fund
    • Private Foundation (PF)
    • 8. Annual Payout Required
    • None (Minimum $750 once every 7 years)
    • 5% of net investment income
    • 9. Governance
    • Not required, since donor directed
    • Board of Directors
    • 10. Legal & Tax Counsel
    • Retained by The Dayton Foundation Plus, Inc.
    • Must retain counsel
    • 11. Accounting & Audit
    • The Dayton Foundation handles all accounting
    • Must establish accounting systems; separate audit may be needed
    • 12. Grants
    • Directed by donor and those appointed by donor to qualified charities. Appointees do NOT have to be living at the fund’s inception.
    • Controlled by PF board
    • 13. Assets
    • Investments pooled; may also hold unusual assets, e.g. S-corp stock, real estate
    • Some restrictions depending on type of assets held
    •  
    • Family Foundation Plus (FF+) Fund
    • Private Foundation (PF)
    • 14. Asset Investment
    • Policy & mechanisms set, results measured & monitored
    • Must implement & manage
    • 15. Fund Corpus
    • Donor directed
    • Board controlled, can grant all income & corpus
    • 16. Suggested Fund Minimums
    • $250,000
    • $10 million (per Council on Foundations)
    • 17. Knowledgeable Staff
    • In place
    • Must employ & manage
    • 18. Administration
    • In place
    • Must establish & maintain
    • 19. Public Report
    • Part of The Dayton Foundation report
    • Must advertise, print & distribute
    •  
    • Family Foundation Plus (FF+) Fund
    • Private Foundation (PF)
    • 20. Operating Expenses
    • Generally 90 basis points (9/10 of 1%) up to $1 million; 45 basis points between $1 million and $5 million; 15 basis points over $5 million (Additional assessments may apply whenever balance is less than $250,000)
    • Paid by asset income — some IRS limitations
    • 21. D & O Insurance, Surety Bonds
    • In place
    • Must carry separate coverage
    • 22. Gift Acceptance Policy & Procedure
    • Established by The Dayton Foundation
    • Must establish

The Dayton Foundation recommends that you consult with your financial, tax or legal advisor when contemplating starting a Family Foundation Plus fund with The Dayton Foundation.

^ top of page
File date: 10.24.16

HERE TO HELP

Michelle Lovely

“Let me tell you more about the financial benefits of establishing a fund through the Foundation over a private foundation or how you can transfer a private foundation to The Dayton Foundation.”
Michelle Lovely, vice president of Development, (937) 225-9948

  • foundation
  • foundation
  • foundation
  • foundation