For donors with the capability to make substantial gifts or gifts of permanent endowment, direct contributions to individual charities may not always be the most appropriate form of giving. Once a major gift has been made, the donor has very limited control over the continued use of the gift, and may lose recognition for the gift after it is commingled with others. In addition, most donors choose to support more than one charity, but making and keeping track of tax-effective gifts to numerous organizations can be cumbersome.

Similarly, many donors have a desire to give back to the community, or they might have a deep interest in a broad charitable cause rather than an attachment to a particular organization.

Finally, and perhaps most important, an organization that is serving the interests of the donor today may change its mission or cease to exist ten years from now.

OPTION 2: CREATE YOUR OWN PRIVATE FOUNDATION
A second option is to form an independent private foundation. A private foundation is an independent charity established, controlled, and maintained over time by the donor or under the instructions of the donor. Private foundations offer substantial flexibility: they can be established for virtually any charitable purpose. For donors in the right circumstances, the private foundation is a very satisfying vehicle for charitable giving. The Southern Tier West Development Foundation encourages the creation of private foundations by donors in the appropriate circumstances.

For some donors, however, the private foundation option carries significant drawbacks. First, the tax benefits of some gifts to private foundations are more limited than those of gifts to public charities. The foundation's trustees must comply with stringent IRS regulations. Private foundation tax returns are public information, affording the donor limited privacy in the operation of the foundation. And the administrative burdens of maintaining a private foundation over time may be formidable and costly.

Because of these various limitations, a private foundation often is not a practical option unless the donor is prepared to make a substantial commitment of time and/or money. Moreover, after the donor's death, control of the foundation may pass to heirs or others who may or may not have the time, skill, or interest to continue the donor's charitable goals.

OPTION 3: ESTABLISH A CHARITABLE FUND WITH THE SOUTHERN TIER WEST DEVELOPMENT FOUNDATION
Your third option is to establish a personal philanthropic fund through the Southern Tier West Development Foundation, a unique hybrid between an operating charity and a private foundation. Click here to find out why this option might be right for you!!