I want to involve my family in philanthropy and want to do something significant, but I’m not sure a private foundation would work for me. Is there an alternative?
While private foundations offer more control than a direct gift to your favorite charity, they require a substantial amount of time, effort and money to get started and also to maintain.
Alternatively, a donor-advised fund at a community foundation offers similar flexibility, but with an entry point of $5,000 to establish your fund, which is fully tax deductible at the time of your gift and can be added to at any time. It costs you nothing to establish a donor-advised fund at Akron Community Foundation. Plus, it offers greater tax deductibility than a private foundation, thanks to Akron Community Foundation’s public charity status.
How can I include my children and grandchildren in my philanthropy?
A donor-advised fund offers you the ability to allow your children, grandchildren, nieces, nephews or other family members to make decisions about your fund in the future, including recommending which nonprofits to support. We can work with you to help communicate your charitable goals and values to them so they can carry on your family legacy for years to come.
In addition, our donor services staff can meet with your family throughout the year – at the community foundation offices or in your home – to facilitate family discussions about charitable giving. If your family wishes, our staff can even offer a list of fully vetted nonprofit programs in your areas of charitable interest. Children especially enjoy learning about local programs and helping to select which organizations to support.
I want to continue supporting our favorite charities while reducing my record-keeping and tax burden.
Unlike a private foundation, donor-advised funds have administration built in. Akron Community Foundation’s highly trained staff will manage all of your paperwork going forward, including research and due diligence on each nonprofit you support, acknowledgment of each gift to your fund, annual audit and tax filings, and check writing and follow-ups to the nonprofits you support. Recommending grants from your fund is easy and can be done by mail, email, phone or 24/7 via our online fund management tool, DonorCentral.
I want to leave a permanent charitable legacy.
I want to be sure my charitable investments are safe.
All community foundation funds are carefully managed with complete transparency in our finances, investment policies, asset allocations, managers, fees, audits and performance. All fundholders receive regular statements and can also review them online through DonorCentral. If you create a fund and wish to recommend a qualified investment manager to oversee your gift, Akron Community Foundation is happy to consider the request in accordance with our official policy.
I want my financial advisor to continue managing my fund’s assets.
You’ve come to the right place. If your family starts a donor-advised fund with an initial gift of $250,000 or more, you can recommend that your current financial advisor manage the assets of your fund, as long as he or she is in accordance with our official outside manager policy.
I want insight into which local nonprofits are doing what and well.
We can certainly help with that. You can take advantage of the community foundation’s deep knowledge of the region’s nonprofits. We can offer you potential grant opportunities from your donor-advised fund based on your areas of interest, as well as give you insight into local issues. We can even take you and your family to visit nonprofits you’re interested in so you can see their programs in action. Or, we can contact one of the more than 1,200 community foundations across the country if, for example, you want to recommend a grant where another family member lives. Except in extraordinary cases where significant expenses are incurred, there is no charge for this service.
I am considering starting or closing a private foundation.
Many people find the administrative and tax burdens of a private foundation to be overly cumbersome. By starting a donor-advised fund at Akron Community Foundation instead – or converting your private foundation to one – you can retain your grant-making involvement while transferring the administrative responsibilities to the community foundation’s knowledgeable staff. We take care of all the paperwork, gift acknowledgment and tax reporting so you can focus on giving back to the causes you care about. In addition, donor-advised funds do not have any mandatory payouts, so you can take your time deciding grants.
Want to learn more? Check out our easy-to-read chart comparing the differences between a private foundation and a donor-advised fund. We also offer a Guide to Donor-Advised Funds that gives you more information on the benefits. As always, one of our staff members would be happy to talk to you, your foundation administrator, or your advisor to discuss which option would be most advantageous for your organization.
Contact Margaret Medzie, vice president and chief development officer, at 330-436-5610 or firstname.lastname@example.org.