Hey everybody, this is Sean Brisk. I wanted to talk to you real briefly about private foundations versus public charities and the difference between the two. Private foundations operate completely different than public charities. Public charities are required by law, per the IRS tax code, to give away a hundred percent of their donations, gifts, and grants after all administrative costs. On the other hand, private foundations, which are essentially trusts treated as foundations, allow the trustee to have complete control over all the assets of the foundation. To provide an example, private foundations file a 990-pf form, whereas all 501c3 tax-exempt organizations file a 990 form. The "pf" in 990-pf stands for private foundation. This form is used to report all gifts, grants, money coming in, interest from securities, investments, rental income, gains or losses from asset sales, and any other revenue of the foundation. In addition, operating and administrative expenses such as compensation to officers, directors, trustees, employee salaries, pension plans, employee benefits, legal fees, accounting fees, depreciation, occupancy, travel, conference, and meetings are recorded on this form. If you have a private family foundation, the foundation is responsible for paying for family retreats and other expenses, allowing you to travel the world. Now, why am I telling you all this? I recently saw on The Ellen DeGeneres Show that Ellen DeGeneres shared the ultimate birthday gift given to her by her wife Portia. She set up the Ellen DeGeneres Wildlife Fund, which focuses on saving gorillas. I thought it was worth sharing because it showcases the power and impact of private foundations. Correcting mistakes and dividing the text into sentences: 1. Private foundations operate differently from public charities. 2. Public charities are required to give away 100% of their donations after all administrative costs. 3. Private foundations file...
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990 pf Form: What You Should Know
The only time that a private foundation should use a Section 4947 (a)(2) — (a)(5) or Section 4947 (a)(3) — (a)(7) trust as a private foundation is if they are doing a 501(c)(3) organization, tax-exempt status is not automatically given by the IRS to any organization that does nonexempt work. This is not the case if you are a tax-exempt non-profit that is exempt under section 501(c)(3)(T) of the Internal Revenue Code of 1986 (The 501(c)(3)(T) organizations are known as Tax-Exempt Organizations (Teams)). The term “private foundation” comes from the laws of tax-exempt charities (as opposed to government charities (see IRS Pub. 4557). A Section 4947(a)(1) Nonexempt Charitable Trust Treated as a Private Foundation allows an organization to be a private foundation if its primary purpose is to solicit and direct charitable contributions for the organization, other than a specific charity tax exemption that is based on the types and amounts of contributions made to an organization in any calendar year.
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