The Internal Revenue Code provides excise tax penalties that can be imposed by the Internal Revenue Service whenever unreasonable or excessive compensation is paid to high-level employees of charitable organizations.
Community foundations are grantmaking public charities that are dedicated to improving the lives of people in a defined local geographic area. They bring together the financial resources of individuals, families, and businesses to support effective nonprofits in their communities. Community foundations vary widely in asset size, ranging from less than $100,000 to more than $1.7 billion.
Community foundations play a key role in identifying and solving community problems. In 2011, they gave an estimated $4.3 billion to a variety of nonprofit activities in fields that included the arts and education, health and human services, the environment, and disaster relief. The Community Foundations National Standards Board confirms operational excellence in six key areas—mission, structure, and governance; resource development; stewardship and accountability; grantmaking and community leadership; donor relations; and communications. Foundations that comply with these standards can display the official National Standards Seal. Right now nearly 500 community foundations have earned the seal.
More than 750 community foundations operate in urban and rural areas in every state in the United States; currently, more than 570 belong to the Council on Foundations. The community foundation model also has taken hold around the world. According to the 2010 Community Foundation Global Status Report, there are 1,680 community foundations in 51 countries. Forty-six percent exist outside of the United States. You can use our Community Foundation Locator to view a list of community foundations in the United States.
Below is everything on our site for community foundations. You can use the filtering options on the right to narrow these results.
The Council receives numerous inquiries each year about the amount of compensation paid to directors or trustees (members of the governing board) of foundations. Since 1969, board members of private foundations have been subject to excise tax penalties for receiving unreasonable compensation. In 1996, Congress passed the “intermediate sanction” rules that enable the Internal Revenue Service to apply similar penalties for excessive compensation paid by public charities.
This memorandum considers whether adoption of the Uniform Prudent Management of Institutional Funds Act (UPMIFA) requires changes to existing guidance regarding the reporting and classification of assets held by community foundations. Current guidance is incorporated in a 1997 memorandum, Report on Classification of Net Assets by Community Foundations, prepared jointly by the Legal Advisory Subcommittee of the Committee on Community Foundations and a committee of the Community Foundations Fiscal and Administrative Officers Group (FAOG).
By Susan E. Budak and Susan N. Gary
Submitted December 21, 2012
Comments on Proposed Amendments to the Regulations Relating to Reliance Standards for Making Good Faith Determinations
This infographic from the Charitable Giving Coalition shows why a cap on charitable deductions would undermine giving and have long-lasting consequences for all Americans.