Comparing Giving Options
When people want to make a difference in their community and create a family legacy, a range of options are available, from creating a private foundation to the public-charity alternatives offered by a community foundation – namely a donor advised fund or supporting organization. While private foundations may allow for greater donor control, the administrative requirements and operating costs can be substantial.
The following chart compares some of the key features of a private foundation with those of a donor advised or supporting organization at the Arizona Community Foundation:
|
Tax Deductibility |
Ease of Establishment |
Costs |
Grantmaking |
ACF Donor Advised Fund
|
Deduct 60% AGI for cash gifts; deduct 30% AGI for gifts of long-term appreciated securities, real estate and closely held stock |
Simple and quick to establish; could be done in one day |
Minimal fees; no start-up costs |
No minimum annual payout; philanthropic services provided by Community Foundation |
ACF Supporting Organization
|
Deduct 60% AGI for cash gifts; deduct 30% AGI for gifts of long-term appreciated securities, real estate and closely held stock |
Several months to establish, but could start with donor advised fund (and convert later to a Supporting Organization) if timing is an issue |
Minimal administrative fees; some start-up legal/filing costs |
No minimum annual payout; philanthropic services provided by Community Foundation |
Private Foundation
|
Deduct 30% AGI for cash gifts; deduct 20% AGI for gifts of long-term appreciated securities; deduction limited to cost basis for gifts of real estate and closely held stock |
Several months to establish |
Typically, costly to set up and maintain; 1-2% excise tax on net investment income |
5% minimum annual payout required; grantmaking services can be purchased from Community Foundation. |