Comparing the Community Foundation with Private Foundations
 
  Community Foundation Private Foundation
Tax treatment of cash gifts: Deductible up to 50% of Adjusted Gross income (AGI). Deduction up to 30% of AGI.
Tax treatment of gifts of appreciated publicly traded securities (long term): Deduction for full market value up to 30% of AGI. Deduction for fair market value, up to 20% of AGI.
Tax treatment of closely held stock or real estate: Deduction for full market value up to 30% of AGI. Deduction limited to donor's cost basis, up to 20% of AGI.
Excise Tax: None. Excise tax of 1-2% of net investment income annually.
Required annual distribution: No annual payment is legally required. Can accumulate income toward a sizeable project or grant. Has flexibility to hold low-yield property. Required to expend 5% of asset value annually, whether or not the foundations investments earn that amount.
Privacy: Individual donors or grants can be kept private. If a donor wishes, the Community Foundation can serve as a buffer between donor and grant seekers. The foundation is required to file detailed tax returns on grants, investment fees, trustee fees, staff salaries, etc. These are public records and are complied into grant-seeker directories.
Investment, accounting, audit and tax returns: The Community Foundation handles all investments and accounting. Community Foundation files annual tax return and provide annual independent audit. Trustee must perform, contract or hire staff for these services.
General administration: The Community Foundation handles all financial and administrative management. Trustee must perform, contract or hire staff for these services.
Grant administration: If donor wishes, the Community Foundation can identify potential recipients, investigate applicants, make grant payments and monitor performance. Trustee must perform, contract or hire staff for these services.
Administrative costs: Varies from about 1% to 2 1/2% depending on the size and type of fund. Varies depending on many factors possibly involving multiple billing sources.