Generally, it is possible for a private foundation with $5 million or in assets, or the potential to reach $5 million in the future, to become a supporting organization of a community foundation. Besides easing the administrative and cost burdens of managing a private foundation, transferring it to a community foundation permits the private foundation to take advantage of many aspects of our public charity status.
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Section 507 of the Internal Revenue Code permits termination of a private foundation in either trust or corporate form with distribution of its assets to a public charity. The two primary requirements for the termination of a private foundation are that the private foundation must distribute all of its net assets to one or more tax-exempt organizations and that each organization has been in existence for a continuous period of at least five years preceding the distribution. Our community foundation fulfills both of these requirements and the private foundation's assets typically form a permanent donor advised fund under a similar name.
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The supporting organization option requires careful consideration by your client and our Board of Directors. For further information on this option, or to discuss a particular client's needs, please contact:
Lisa Foley, Director of Gift Planning
(603) 225-6641 ext. 262
lmf@nhcf.org
Peter Lamb, Vice President of Development
(603) 225-6641 ext. 241
pl@nhcf.org |
