Should you choose to hire paid staff, compensation must be reasonable, and the services provided must be reasonable and necessary to carry out the private foundation’s tax-exempt purpose. Compensation even may be provided to a disqualified person (i.e., staff or board member) as long as these standards are met. The Internal Revenue Service (IRS) says... Read More
Here are the things a private foundation must do every year to remain a private foundation and stay out of trouble: Pay your annual excise tax on the foundation’s net investment income through quarterly estimated payments. File your federal tax returns and comply with state filing rules. Meet your annual minimum distribution requirement through grants... Read More
Don’t spend your days dreaming of more engaged members. Here are some ideas to get your trustees’ attention and breathe some life into your board: Communicate with your trustees–Ask them (either individually or as a group) what they want out of board service. Are they satisfied with the way things are? What would they like... Read More
From a tax law perspective, a private foundation may pay “reasonable and necessary” administrative expenses—and count them toward its annual distribution requirement—without subjecting the foundation or its managers to a penalty tax. These expenses must be (a) related to the accomplishment of the foundation’s charitable purposes, (b) related to its investments, or (c) payments of... Read More
A forum for investors to shape the progression of national and global issues, socially responsible investing (SRI) traces as far back as the 1700s, when the Quaker Philadelphia Yearly Meeting prohibited members from buying or selling into the slave trade. John Wesley, a founder of Methodism, preached against engaging industries that harmed one’s neighbor. The... Read More
The individuals responsible for managing a foundation’s assets want their investments to do well. Beyond these good intentions, however, most states maintain laws with higher standards that legally bind trustees and board members to a series of duties and responsibilities. These standards—called fiduciary duties—are commonly known as the duties of care, loyalty, and obedience, as... Read More