Private Foundation versus Public Charity
The usual form of a charity is a Private Foundation which receives and invests a large sum received from one or a few individuals or corporations. The Ford Foundation and the Bill and Melinda Gates Foundations are examples of Private Foundations funded by corporations or families. Private Foundations pay a nuisance tax on their investment earnings and must distribute, on average, five percent of their assets per year.
A Public Charity receives more than 1/3 of its funding from the public, governments or other charities and less than 1/3 from investment income. The American Red Cross and American Cancer Society are examples of a Public Charity.
© 2014 David B. Foltz, Esq.
A Public Charity receives more than 1/3 of its funding from the public, governments or other charities and less than 1/3 from investment income. The American Red Cross and American Cancer Society are examples of a Public Charity.
© 2014 David B. Foltz, Esq.
| private_foundations_vs_public_charities.pdf |