What Exactly is a Community Foundation?
A community foundation is a tax-exempt public charity created by and for the people of the community and governed by a volunteer board of trustees. A community foundation provides convenient bridges between donors and charities: they act as catalysts for community improvement by working with a wide variety of partners. A community foundation is a permanent entity. Endowed funds in a community foundation will continue to benefit a community forever.
Each community foundation is made up of a permanent foundation and a collection of charitable funds that are focused in a specific geographic region, established by various donors, then pooled and invested together so that the income provides a steady resource for the community. Those who do their charitable giving through a community foundation can make contributions for the general benefit of the community, or designate their funds for special purposes.
The first community foundation was founded in 1914 in Cleveland. Today more than 700 community foundation across the United States have over $15 billion in combined assets, and contribute more than $1 billion to nonprofit organizations every year.
It takes a whole community to build and maintain a community foundation. This is why community foundations regularly welcome and depend on resourceful volunteers to share the workload: fundraising, grantmaking, researching, convening, and providing technical expertise to other charitable organizations in the community.
The IRS protects community foundations from misuse (narrow or private-interest focus, for example), by requiring funds to come from a variety of donors, and a community foundations governing body to be diverse and representative of the entire community. Besides ensuring that the public will be better served, such close regulation gives donors maximum allowable tax advantages, and makes contribution to new or existing foundations a smooth process (no legal or accounting hurdles).
Each community foundation is made up of a permanent foundation and a collection of charitable funds that are focused in a specific geographic region, established by various donors, then pooled and invested together so that the income provides a steady resource for the community. Those who do their charitable giving through a community foundation can make contributions for the general benefit of the community, or designate their funds for special purposes.
The first community foundation was founded in 1914 in Cleveland. Today more than 700 community foundation across the United States have over $15 billion in combined assets, and contribute more than $1 billion to nonprofit organizations every year.
It takes a whole community to build and maintain a community foundation. This is why community foundations regularly welcome and depend on resourceful volunteers to share the workload: fundraising, grantmaking, researching, convening, and providing technical expertise to other charitable organizations in the community.
The IRS protects community foundations from misuse (narrow or private-interest focus, for example), by requiring funds to come from a variety of donors, and a community foundations governing body to be diverse and representative of the entire community. Besides ensuring that the public will be better served, such close regulation gives donors maximum allowable tax advantages, and makes contribution to new or existing foundations a smooth process (no legal or accounting hurdles).
