{"tinyMCE_dummy":"","title":"Comparison of Donor Advised Funds and Private Foundations","url":"\/create-a-fund\/types-of-funds\/what-is-a-donor-advised-fund\/comparison-of-donor-advised-funds-and-private-foundations","meta":{"title":"","description":"","excludeFromSitemap":"No"},"ordinal":999,"content":"<p><strong><em>Consider the advantages of working through the North Carolina Community Foundation to accomplish your charitable goals <\/em><\/strong><\/p>\r\n<h2>Establishment and operation<\/h2>\r\n<table cellspacing=\"0\" cellpadding=\"0\">\r\n<tbody>\r\n<tr>\r\n<td width=\"33%\">\r\n<p> <\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p><strong>Donor-Advised Fund at the NCCF<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p><strong>Private Foundation<\/strong><\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Recommended size<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>$25,000 minimum, as of July 1<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>$10 million recommended minimum to justify operating costs<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Start-up and initial costs<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>None<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>All legal, accounting and filing fees<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Ongoing administration and annual costs<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>1% annual fee (may be negotiated favorably for funds above $1 million)<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>All costs (legal, accounting, payroll, audit) are incurred by private foundation<\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<h2>Tax considerations<\/h2>\r\n<table cellspacing=\"0\" cellpadding=\"0\">\r\n<tbody>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Excise taxes<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>None<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Subject to 1-2% annually<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Tax status and filings<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Qualifies under NCCF’s public charity status; no filing necessary<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Must file for private foundation tax-exempt status<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Excise taxes<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>None<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Subject to 1-2% annually<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong><em>Tax-deductibility of gifts<\/em><\/strong><\/p>\r\n<p><strong><em>Cash<\/em><\/strong><\/p>\r\n<p><strong><em>Appreciated stock (held more than one year)<\/em><\/strong><\/p>\r\n<p><em><strong>Real estate and closely held stock (held more than one year)<\/strong><\/em><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Deduction up to 60% of adjusted gross income<\/p>\r\n<p>Fair market value up to 30% of adjusted gross income<\/p>\r\n<p>Fair market value up to 30% of adjusted gross income<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Deduction limited to 30% of adjusted gross income<\/p>\r\n<p>Fair market value up to 20% of adjusted gross income<\/p>\r\n<p>Cost basis up to 20% of adjusted gross income.<\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<h2>Grantmaking support and requirements<em> <br \/><\/em><\/h2>\r\n<table cellspacing=\"0\" cellpadding=\"0\">\r\n<tbody>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Grantmaking support<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>NCCF provides due diligence review of grantees recommended by donor.<\/p>\r\n<p>Research on specific non-profits provided upon request.<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Donor must establish and oversee all evaluation, monitoring and reporting procedures.<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Payout requirements<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>None. Grant recommendations of 5% recommended but no government-required payout<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Annual minimum payout of 5% of assets required (subject to penalty on undistributed amount)<\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<h2>Investment management<\/h2>\r\n<table cellspacing=\"0\" cellpadding=\"0\">\r\n<tbody>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Investments<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Fund assets professionally invested through NCCF. Donor may choose from selection of NCCF asset managers.<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Must secure and oversee own investments. <\/p>\r\n<p>Investment management fees the responsibility of the private foundation<\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<h2>Donor involvement and privacy<\/h2>\r\n<table cellpadding=\"0\">\r\n<tbody>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Donor involvement<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Donor recommends grants to qualified nonprofits. Grants are approved by NCCF.<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Donor appoints initial board of a nonprofit corporation. Board controls investment and grantmaking.<\/p>\r\n<\/td>\r\n<\/tr>\r\n<tr>\r\n<td width=\"33%\">\r\n<p><strong>Privacy and confidentiality<\/strong><\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Fund may be named or anonymous. Contributions, assets and grants may be kept confidential.<\/p>\r\n<\/td>\r\n<td width=\"33%\">\r\n<p>Detailed public disclosure annually from posting of IRS 990PF, which makes public all assets and grants.<\/p>\r\n<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<p>If you want to discuss the advantages of a community foundation structure vs. a private foundation, contact Beth Boney Jenkins.<\/p>","excerpt":"","media":0,"custom":{"blocks":{"blocks":[{"fieldset":"319fa2ab33b04f0d8fcad64553fb94d6","fieldset_slug":"_footnote","content":"<p>To learn more, please contact our <a href=\"\/about-us\/meet-our-staff#development\">development team.<\/a><\/p>"}]},"masthead":{"title":"","counties":"","affiliate_logo":"","sub_text":"","background_image":"","caption":""},"latest_blog":{"post":""},"social_sharing":{"share_image":""},"the_latest":{"show_latest_posts_by":""}},"inMenu":false,"visibleTo":"Everyone","publishedAt":1533143776,"orderChildrenBy":"ordinal","enableComments":false,"permission":"read","id":"a0e7a77742244bb8b83a8768d15e4f24","parent":"3e7cd501509a4571a52e0adc17e8dc83","node":98424,"created":1533143776,"modified":1678127733,"fresh":1,"type":"page","children":{},"relations":{}}