As a benefit of membership, the Council on Foundations attorneys and legal staff provide information and education to Council members regarding a variety of topics related to foundation operations and legal compliance. All information on this website, and all publications, articles, e-mail correspondence and telephone consultations provided by Council attorneys and legal staff are intended for informational purposes only and not as part of an attorney-client relationship. Council attorneys are not licensed in every state and cannot provide legal representation. The information is not a substitute for expert legal, tax or other professional advice tailored to your specific circumstances, and may not be relied upon for the purposes of avoiding any penalties that may be imposed under the Internal Revenue Code.
Section 4947(a)(2) Split-Interest Trust Reporting
Legal Compliance Guidance
The Pension Protection Act of 2006 (PPA) has introduced filing requirements for split-interest trusts such as charitable remainder trusts and pooled income funds.
Which returns are affected?
These requirements apply to returns for taxable years beginning after December 31, 2006.
What are the…
Public Disclosure of Form 990-T for Private Foundations and Public Charities
Legal Compliance Guidance
Under the Pension Protection Act of 2006 (PPA), the rules for public disclosure of the Form 990-T by public charities and private foundations became identical to those for Form 990.
Which forms are affected?
Any Form 990-T filed after August 17, 2006.
What are the public disclosure requirements…
Contributions of Fractional Interests in Tangible Personal Property
Legal Compliance Guidance
The Pension Protection Act of 2006 (PPA) imposes requirements for determining the charitable deduction permitted for gifts of fractional interests in tangible personal property.
What contributions are affected?
These requirements apply to contributions made after August 17, 2006.
What is…
Donor Guidance for Non-Cash Charitable Contributions
Legal Compliance Guidance
Contributions of clothing and household items
Section 1216 of the Pension Protection Act of 2006 (PPA) imposes requirements for contributions of clothing and household items to charity. The provision is effective for contributions made after the date of enactment (August 17, 2006).
In general,…
Tax Reporting for Supporting Organizations
Legal Compliance Guidance
Affected transactions: Returns filed for taxable years ending after August 17, 2006.
Are all supporting organizations required to file Form 990?
Yes. Prior to the enactment of the Pension Protection Act of 2006, public charities that normally received less than $25,000 in annual gross receipts…
Guidance for Donor Advised Funds, Supporting Organizations, and Employer Disaster Funds
Legal Compliance Guidance
This resource is a Council Summary of IRS Interim Guidance found in IRS Notice 2006-109, issued December 6, 2006, and explains steps for determining supporting organization status, and important information on the employer disaster relief fund exemption.
Responding to requests from the Council on…
Provisions Affecting Supporting Organizations
Legal Compliance Guidance
This chart outlines all provisions that affect the operations of supporting organizations.
Permissible Grantees for Donor Advised Funds
Legal Compliance Guidance
This chart details which organizations can receive grants from donor-advised funds and which ones cannot.
Scholarship Funds and PPA Compliance
Legal Compliance Guidance
Bringing Funds Into Compliance
The Pension Protection Act of 2006 (PPA) includes the first comprehensive regulation of donor-advised funds. For the first time, donor-advised funds are legally defined. The legal definition is important for grantmakers that operate various kinds of component funds,…
Prohibited Benefits from Donor Advised Funds
Fundamentals, Legal Compliance Guidance
Donors and advisors are prohibited from receiving more than incidental benefits from grants made from their advised funds. Penalties apply to those who received a prohibited benefit, to those who recommended the grant, and, in some situations, to fund managers who approved the recommendation.…
Tax Reporting for Organizations that Hold Donor-Advised Funds
Legal Compliance Guidance
If our organization holds donor-advised funds, what information must we provide on Form 990?
A sponsoring organization, such as a community foundation, must disclose on Schedule D, Part I of its 990 the following information:
Number of donor-advised funds owned;
Aggregate value of assets held…
Intermediate Sanctions for Donor Advised Funds and Sponsoring Organizations
Fundamentals, Legal Compliance Guidance
The Pension Protection Act of 2006 created new categories of disqualified persons for donor advised funds and sponsoring organizations under the intermediate sanctions rules.
Categories of Disqualified Persons Created under the PPA
Donors and donor advisors with regard to transactions with the…
Excess Business Holdings Rules for Donor Advised Funds
Legal Compliance Guidance
Under the Pension Protection Act of 2006 (PPA), the private foundation excess business holdings rule applies to donor-advised funds as if they were private foundations.1 That is, the holdings of a donor-advised fund in a business enterprise, together with the holdings of persons who are…
Council Summary: Congressional Research Service Report on Donor-Advised Funds
Legal Compliance Guidance
The Congressional Research Service issued a 2012 report on charitable giving and donor-advised funds. Using data from Form 990, the report updates to 2008 some of the statistical information about donor-advised funds that was included in the 2011 Treasury report on donor-advised funds. However, the…
Attracting Contributions from Private Foundations
Legal Compliance Guidance
The legal and tax implications for community foundations accepting donations from private foundations, and qualifying distributions of taxable expenditures. Additional insight into converting a private foundation into a supporting organization of a community foundation.
Substantiating Contributions to Donor-Advised Funds
Legal Compliance Guidance, Fundamentals
What requirements must our foundation follow for substantiating contributions to donor-advised funds?
To claim a charitable, gift or estate tax deduction for any contribution to a donor-advised fund, donors must obtain a contemporaneous written acknowledgement from the sponsoring organization that…