Private foundations are a great community asset and are ideal for some families. For others, bigger tax savings, less administrative hassles and lower operational costs associated with establishing a fund through The Dayton Foundation provide a more attractive alternative.
Whether you want to leave a bequest in your will or be an active donor during your lifetime, we can help you:
achieve your charitable goals;
save on administrative and legal costs;
avoid restrictions and potential penalties by the IRS; and
achieve valuable tax savings.
Reasons to Establish an Invested Donor-Advised Fund or Family Foundation PlusSM through The Dayton Foundation vs. Establishing a Private Foundation
Invested
Donor-Advised Fund
Family
Foundation PlusSM
Private
Foundation (PF)
1. Legal entity
Established by The Dayton Foundation
Established by The Dayton Foundation Plus, Inc.
Must establish by PF; 501(c)(3) must be obtained by IRS
2. Tax status
Public charity
Public charity
Private foundation
3. Valuation of gifts, other than publicly traded stock
Fair market value
Fair market value
Cost basis
4. Tax deductibility of donations
60% of adjusted gross income (AGI) for cash gifts; 30% of AGI for long-term capital gains
60% of AGI for cash gifts; 30% of AGI for long-term capital gains
30% of AGI for cash gifts; 20% of AGI for long-term capital gains
5. Taxes paid
None
None
1.39% excise tax on net investment income; other excise taxes may apply
6. Tax returns, states and federal
Separate fund report not needed; donor’s privacy can be protected, if desired
Separate fund report not needed; donor’s privacy can be protected, if desired
Federal 990-PF filed by PF — grant history open to public inspection
7. Annual payout required
None
None
5% of net investment income
8. Governance
Not required, since donor advised
Not required, since donor advised
Board of Directors
9. Legal and tax counsel
Retained by The Dayton Foundation
Retained by The Dayton Foundation Plus, Inc.
Must retain counsel
10. Accounting and audit
All funds consolidated; no separate accounting is required
All funds consolidated; no separate accounting is required
Must establish accounting systems; separate audit may be needed
11. Grants
Suggested by donor and those appointed by donor to qualified charities; successor advisors must be alive at the time the fund is established.
Suggested by donor and those appointed by donor to qualified charities; successor directors do NOT have to be living at the fund’s inception, offering infinite succession.
Controlled by PF board
12. Assets
Investments pooled for lower fees and greater diversification of assets
Investments pooled for lower fees and greater diversification of assets
Some restrictions depending on type of assets held
13. Asset investment
Policy and mechanisms set; results measured and monitored
Policy and mechanisms set; results measured and monitored
Must implement and manage
14. Fund corpus
Ability to invade corpus determined by donor at inception of fund
Ability to invade corpus determined by donor at inception of fund
Board controlled; can grant all income and corpus
15. Knowledgeable staff
In place through The Dayton Foundation
In place through The Dayton Foundation
Must employ and manage
16. Administration
In place through The Dayton Foundation
In place through The Dayton Foundation
Must establish and maintain
17. Public report
Part of The Dayton Foundation report
Part of The Dayton Foundation report
Must comply with public inspection requirements
18. Operating expenses
Community Investment fee to The Dayton Foundation (9/10 of 1%) up to $1 million; 45 basis points between $1 million and $5 million
Community Investment fee to The Dayton Foundation (9/10 of 1%) up to $1 million; 45 basis points between $1 million and $5 million; 15 basis points over $5 million (Additional assessments may apply whenever balance is less than $250,000.)
Paid by asset income – some IRS limitations
19. D & O insurance, surety bonds
In place
In place
Must carry separate coverage
20. Gift acceptance policy and procedure
Established by The Dayton Foundation
Established by The Dayton Foundation
Must establish
21. Complex gift planning
In place through The Dayton Foundation
In place through The Dayton Foundation
Must obtain
Get Started Today
The Dayton Foundation offers a variety of fund options to fit your giving needs and financial plans.