How To Start A Charitable Foundation

Not so long ago, starting and operating a charitable foundation was a right for a privileged few. The fees for appointing a trustee to run the foundation that put the tax advantage that it gained, not only for the donors, but for their loved ones who were disallowed from enjoying the full benefits of their parent's or friend's life work due to sometimes prohibitive taxation. Not only that, but the donors did not have the pleasure of finding a charity of their choice and see the direct benefits of their kind gifts take effect in their own life time.

Nowadays, the opportunity of enjoying the tax benefits are available to all, wherever they are and whatever tax bracket they find themselves in.

The methods of how to start a charitable foundation are pretty straightforward. Here's how it works:
  • You make the decision that you wish to start a charitable foundation. The foundation can be in your own name, the name of your company (if you own one) or in your family name.
  • You can fund the foundation through direct deductions from your salary, your credit card or your bank account.
  • Your foundation can also accept donations from members of your family, friends or colleagues.
  • You can fund the foundation from whatever religious community you belong to, and fellow members of the contribution can also participate.
  • Your foundation can make grants to any registered charity, religious foundation, and school or art gallery.
  • You can donate to the charity of your choice any time during the fiscal year, as long as you have funds in your account.
  • As trustee, you can request sets of accounts and planned projects from any charity that you may be interested in donating to.
  • You can deal directly with whatever charity of your choice. As you act as your own trustee, there are no costs involved.
  • In the event that you donate to a particular charity you are entitled to receive a consolidated receipt for tax purposes.

Just what you were looking for? Here is what you need to know on how to start a charitable foundation.

In order to incorporate your new charitable organisation, you will need to prepare what is known as a mission statement. This is good for someone who is planning to establish such an organization in any event, as it will probably go a long way to quantifying the goals of the fledgling organization.

The mission statement can be as simple as the goals of the charitable organization itself. It should include the following:
  1. Who will benefit from the charity?
  2. How will they benefit.
  3. Which values will guide you to make the decisions regarding beneficiaries of the charitable trust?
  4. How your charitable deeds will be presented to others, and encourage them to join your trust.

Now that you have established the goals of your charitable foundation, you should set about its incorporation. Much of the setting up can be done by you, but at some stage you should involve a lawyer on how to exactly set up the incorporation. It should be very much as laid out in your mission statement.

Your lawyer will just be much more capable in filling out the paperwork necessary. If you have any friends or colleagues involved in similar charitable foundations, you will rapidly discover that they are more than prepared to offer you any advice and guidance necessary to help your charitable foundation become established as rapidly and efficiently as possible.

These are the simple steps involved in how to start a charitable foundation. It can be as simple as you make it and will should provide you with the intangible joy of giving, whilst enjoying the income and estate tax benefits previously enjoyed by too few worthy people.