You can set up the foundation while you are living, or it can be established after you die. To qualify, a small percentage of the trust assets must be distributed to charity each year. But you can name whomever you wish to run the foundation, including your children, and the foundation can pay them a reasonable salary. You can be very specific about which charities you want to support, or you can leave that up to the trustees of the foundation to decide (within the IRS guidelines, of course).
The tax benefits of setting up your own
foundation can be substantial. You can save estate,
capital gains and ordinary income taxes:
•There will be no capital gains tax when the assets are sold by the foundation, so it's great for appreciated assets.
donate publicly traded securities to a private
foundation, you can get a charitable income tax
deduction for their full fair market value - up to
30% of your adjusted gross income. (The deduction is
less than the 50% limit for standard charitable
contributions because this is a private charitable
Price & Farrington,
PLLC - Attorneys and
Counselors at Law