Funds vs Trusts

Funds vs Trusts

Forum topic posted in Forum on 27 April 2008| 3 comments
audience: | last updated: 27 April 2008
4 posts / 0 new
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s r
Joined: 01/01/2008
Points: 70
Okay. I am totally out of the planned giving world... But, if someone can help me out I would be thankful. (try to not laugh.) Is there a difference between someone setting up a Charitable Fund ... and a trust? If a widower names a Charitable Fund after his late wife and then raises money for whatever he decides, does the fund have to file public paperwork if they donate to or partner with a 501 (c) 3? For instance, if the fund uses the 501's name and facility to fund-raise to it's own benefit and excludes the 501 from the proceeds, is the 501's BOD in violation of their fiduciary responsibilities to the 501? Does the 501 have to show that relationship on their 990? Does the Charitable Fund have to acknowledge the 501's contribution of time, staff and loan of facility somewhere in financial documents that are online? As you can see, there are lots of questions and hopefully, no answers that will cause us to panic. Thanks.

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Joined: 04/21/1999
Points: 15
I have a single person age 66 leave his estate (he wants it placed in a trust) to our school for endowed scholarships for needy students. Does any one have suggestions regarding sample documentation? thanks for any assistance or suggestions.
Joined: 11/14/2002
Points: 30
Funds vs. Trusts
I suggest you partner with someone who has experience setting up not-for profit entities. You have choices, of course, and for me the amount of the donation helps drive me to which choice fits best. If you have a fund of $100,000 or less (some would say $250,000), I'd suggest the use of a Donor Advised Fund with a local community foundation, or a national Charitable Gift Fund. It can bear the name of the donor. If you have a larger gift, you can estabish a charitable trust and apply for private foundation status with the IRS. A private foundation can also be set up as a not-for-profit corporation if you are going to have a group of people who will manage the decision-making like a board of directors. Private foundations make grants to qualified charities. If the activity is more of an operating charity doing charitable good works, and it is a much larger gift, you may consider creating an operating foundation. "Charitable Gift Planning," by Thomas J. Ray, Jr. and published by the ABA is a good source book, as is "Complete Guid to Nonprofit Organizations" by Penina Lieber and published by CRI.
s r
Joined: 01/01/2008
Points: 70
Thank you so much. I just have been watching a friend struggle as board member of a 501 with a fund owner (who is a board member also) who seems to take advantage of the 501 facilities and mailing lists for the fund events. I was just concerned that something should be reported somewhere and it wasn't being done, apparently the fund is separate and private.
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