Types of Private Charitable Foundations

Private charitable foundations can be established as trusts or corporations, and during a client’s lifetime or at death. In addition, private charitable foundations can be subdivided into two further categories:

Private Operating Foundation
This type of foundation devotes most of its resources to the active conduct of its exempt activities. For example, a foundation created to operate a homeless shelter. (A more complete description of the types of foundations which fall under this category can be provided during a consultation with our attorneys.) The administration of these foundations can be extremely complicated and expensive to operate.

Non-Operating Foundation (or private pass-through foundation)
This type of foundation typically makes grants to help fund the efforts of other organizations or individuals. For example, a foundation created to provide grants to unrelated homeless shelters. The set up and administration of these foundations is a simpler process as it does not involve direct services and only supports other organizations by making grants.