Private Foundation Management Service

Private Foundations offer unique and exciting benefits for families, individuals, and corporations to take ownership of their philanthropic efforts.  They are the cornerstone of philanthropy and help empower charitable efforts all around the world.

Whether you have an established private foundation that has been operating for years or you would like to establish a new private foundation, Crewe Foundation Services can help in all aspects with our setup and administrative services.

New Private Foundation Establishment

With our network of trusted and proven legal professionals, we will draft and file the following initial creation documents and handle all filings and compliance:

  • Articles of Incorporation or Trust Document
  • Bylaws
  • Conflict of Interest Policy
  • Federal EIN
  • IRS Form 1023 Application for Tax Exemption
  • Policies and Governance
  • Establish Board Member Structure
  • Define Roles and Responsibilities
  • Create and Implement Organizational Policies and Procedures
  • Compliance Management With State and Federal Regulators

Create a Private Foundation Now

Existing Private Foundation Management

Our full suite of foundation management tools and services will allow you to focus on the important work – giving. Allow us to handle the following aspects of administration:

  • Grants Management
    • Full online access for research and grant requests
    • Grant recipient due diligence and qualification
    • Set up and negotiations of all grant agreements
    • Foreign grant setup and management
    • Grant processing
    • Grant reporting
    • Grant responses & communication
    • Annual and quarterly Grant Reports
  • Accounting and Bookkeeping
    • Annual and quarterly statement of activity to foundation board and management
  • Tax Reporting and Filing
  • Compliance Management with State and Federal Regulators

Private Foundation Frequently Asked Questions

A private foundation is a type of charity funded by one person, family or company. Unlike public charities which get funding from the general public, private foundations get funding from a limited number of sources. These foundations are set up to support things like education, healthcare, research or cultural initiatives. They work by investing their assets and using the income to make grants to other non-profits or fund charitable activities directly. Private foundations are heavily regulated by the IRS, including an annual minimum distribution of 5% of their assets. While they offer great tax benefits to the founder, they also have more stringent oversight and reporting requirements than public charities. Private foundations play a big role in philanthropy, often tackling long term, complex social issues and providing big support to causes that align with the founder’s values and vision.

Private foundations have a lot of flexibility in how they give, but they must follow IRS rules. Typically they can give to public charities which are 501(c)(3) organizations. These are educational institutions, hospitals, museums, social service organizations and more. Private foundations can also give to individuals for charitable purposes such as scholarships or disaster relief but these require documentation and pre-approved procedures. In some cases they can give to government entities for charitable purposes. Private foundations can also do direct charitable work, fund their own programs instead of giving to other organizations. They can also make Program-Related Investments (PRIs) in for-profit ventures that align with their charitable mission. But private foundations cannot give to political campaigns, lobbying efforts or for the private benefit of foundation insiders. They must also exercise due diligence to make sure their funds are used for charitable purposes and not diverted to non-charitable uses. While the options are many, each grant must be for the foundation’s stated charitable purpose and follow the legal requirements to maintain the foundation’s tax-exempt status.

Starting a private foundation involves several steps and considerations. First you need to define your foundation’s mission and charitable purpose which will guide your giving. Next you should consult with legal and financial professionals to help navigate the regulatory maze. You’ll need to choose a legal structure, usually a trust or a non-profit corporation, each with its pros and cons. Then you’ll need to file for incorporation in your state and apply for tax exempt status with the IRS using Form 1023. This application requires detailed information about your foundation’s structure, governance and planned activities. You’ll also need to create bylaws, appoint a board of directors and establish policies for grantmaking and asset management. Funding the foundation is a big step which can be done with personal assets, stocks or other valuable resources. You need to understand the tax implications and required annual distributions (usually 5% of assets). You’ll need to set up proper accounting systems and prepare for annual tax filings and public disclosure requirements. You may also want to hire staff or consultants to manage day to day operations and grantmaking. While starting a private foundation can be complicated and time consuming it’s a powerful way to create a lasting legacy and make a big impact in areas you care about.

Private foundations are 501(c)(3) organizations but they are a separate category within that. Both private foundations and public charities are 501(c)(3) but they are subject to different rules and regulations. The main difference is in their funding source and operational characteristics. Private foundations get their funding from one source, an individual, family or corporation and primarily do grantmaking not direct charitable activities. Public charities get broader public support and do direct services. Private foundations have more stringent regulations, 5% annual distribution of assets and restrictions on self-dealing. They also have different tax deduction limits for donors compared to public charities. The IRS automatically classifies a 501(c)(3) organization as a private foundation unless it can prove it’s a public charity. This classification affects how the organization operates and how it’s perceived by potential grantees and donors. Both are tax exempt but the private foundation designation comes with unique responsibilities and limitations that sets it apart from other 501(c)(3) entities.
Private foundations are tax exempt organizations but their tax exemption comes with conditions and responsibilities. As 501(c)(3) organizations, private foundations are generally exempt from federal income tax on their income. But this exemption is not absolute. Private foundations are subject to an excise tax on their net investment income which is 1.39% of their net investment income annually. This tax helps fund the IRS’s oversight of exempt organizations. Private foundations must be careful to avoid activities that could jeopardize their tax exemption such as self-dealing, excess business holdings or making taxable expenditures. They must distribute at least 5% of their assets annually for charitable purposes to maintain their tax exemption. Private foundations must also file detailed annual tax returns (Form 990-PF) which are open to public inspection. Donors to private foundations can get tax deductions for their contributions but these deductions are generally less than for public charities. Private foundations must be careful to manage their activities and finances to comply with IRS rules and maintain their tax exemption as penalties or loss of tax exemption can result.
Private foundations can take donations but it’s less common than public charities. Most private foundations are funded by a single source such as an individual, family or corporation but they are allowed to accept donations from outside donors. Donations to private foundations are tax deductible for the donor but with more limitations than public charities. For example cash donations to private foundations are deductible up to 30% of the donor’s adjusted gross income versus 60% for public charities. For appreciated property the limit is 20% for private foundations versus 30% for public charities. Note accepting public support in large amounts could affect the foundation’s status. If a private foundation starts to receive a significant portion of its support from public sources it may need to consider reclassifying as a public charity. Private foundations also need to be careful about accepting restricted gifts that could conflict with their mission or jeopardize their tax exempt status. Private foundations can and do take donations but their primary focus is usually on managing and distributing their existing assets rather than fundraising. Donors should consult with tax professionals to understand the implications of giving to a private foundation versus other charitable options.

A private foundation management company provides support and expertise to private foundations to help them navigate the world of philanthropy and compliance. They handle many of the administrative and strategic tasks of a foundation.

On the administrative side they manage the day to day, bookkeeping, accounting and financial reporting. They prepare and file the annual Form 990-PF and other required tax documents to ensure compliance with the IRS. They also handle grant administration, application processing, due diligence on potential grantees and grant distributions.

Strategically they provide guidance on investment management to help foundations grow their assets while adhering to their investment policies. They help develop and implement grant making strategies aligned with the foundation’s mission and goals. Many offer board support services, meeting organization, minute keeping and governance best practices.

They keep foundations informed of changes in the law and regulations affecting the philanthropic world. They may offer technology solutions for grant management, document storage and reporting. Some offer program evaluation, impact measurement and family dynamics in family foundations.

By outsourcing these functions to specialized companies foundations can get professional expertise without having to have a large in-house staff. Foundation leaders can focus more on their philanthropic vision and less on the operational details. But it’s important to choose a management company that fits your values and understands your foundation’s needs and goals.

Start Your Private Foundation with Crewe Foundation Services

Open a New DAF Account

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Please download, complete, and return the following forms:


The above documents will also be forwarded to you by email.  Please return signed forms via email to info@cfs.octiv.site or by fax to (801) 563-1971.

You will be contacted by a Crewe Foundation Specialist when your new account has been created and is ready for funding.