The Internal Revenue Code (IRC) contains precise definitions for tax purposes of what is a charity and what is a private foundation. The difference is important because special rules and penalty taxes apply to private foundations but not public charities. Section 501(c)(3) of the IRC defines a charitable organization as follows: Corporations, and any community... Read More
In today’s litigious society, anyone—including your foundation and the individuals associated with it—may be the target of a lawsuit. Although state and federal laws may provide some protection for your board members and volunteers, this immunity will extend to your organization in only a few states. These laws often contain no protection for legal expenses,... Read More
Executive Order 13224, issued by President George W. Bush on September 25, 2001, was entitled “Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism.” It includes a long list of individuals and organizations perceived to be associated with terrorism. If a foundation is found to be supporting any individual... Read More
How can funders help their grantees to be as effective as possible? Even small amounts can go a long way toward alleviating the tremendous demands on executive directors. Exponent Philanthropy members offer these suggestions: Board recruitment, training, and development—Consider making a grant to allow the nonprofit to focus on board recruitment, training, and development. According... Read More
When it works, collaboration in any form is a powerful tool for enhancing organizational capacity. It can keep lone organizations strong and sustainable over time. In a sector in which services often are duplicated, collaboration can streamline efforts and produce better results. In his report Real Collaboration: A Guide for Grantmakers, David La Piana lists... Read More
Foundations face a number of possible investment expenses whose range is considerable. Be sure to ask questions of your investment managers or your consultant, and don’t accept fuzzy answers. Make reviewing these fees a regular leadership activity. A snapshot of typical fees Custodial fees—These fees are paid to an institution (e.g., bank) to hold your... Read More