Activity |
NYFA's Artist
Fund |
Private Foundation |
Organization
|
Established |
Need to establish |
Tax-exempt status
|
501(c)(3) exists |
Need to apply to IRS |
Funds required |
$1,000 minimum |
Usually $1 million or more |
Donor’s role in selecting grants |
Donor or donor’s designatee recommends grants |
Donor specifies grants |
Tax deductibility
|
Maximum allowed by law |
Limited deductibility |
Federal approvals, restrictions, special taxes |
Already approved by IRS
No payout requirements
Not subject to Federal excise tax |
Greater likelihood of IRS audits
Requires 5% charitable payout annually
Subject to excise tax |
Mechanisms for making grants and creating funds |
Exists |
Must create |
Office space
|
Exists |
May need to obtain |
Staffing
|
Exists |
May need to employ |
Accounting
|
Exists |
Must employ |
Tax returns (state & IRS) |
Included in NYFA’s report |
Must prepare |
Public report |
Included in NYFA’s annual report |
Prepare, print, and mail |
Solicitation of proposals from potential grantees |
Provided at donor’s request |
Donor must provide |
Review of applications
|
Provided |
Donor must perform |
Public recognition of donor |
Provided by NYFA, or donor may remain anonymous |
Donor must depend on grantees |
Director and Officers liability insurance |
Covered |
May be needed |
Investment of assets
|
Provided |
Need to obtain |
Overhead |
5 to 8%, depending on the size of the fund |
Varies widely and can be substantial |
