For Professional Advisors
The Catholic Foundation welcomes your participation in a unique partnership structured to provide your clients with a plan for their philanthropic pursuits that is as effective, efficient and rewarding as every other element of the financial and estate planning you facilitate.
We invite you to avail yourself of the Foundation’s considerable resources for professional advisors, many of which, including the Professional Advisor Handbook, and a newsletter for advisors, The Good Advisor, can be found on this website.
To add your name and business affiliation to our mailing list of professional advisors, and to receive publications, updates and invitations from The Catholic Foundation, please click here.
Why a Community Foundation
As a community foundation, The Catholic Foundation offers considerable flexibility and significant tax advantages to most donors. We are equipped to handle gifts of virtually any financial source and complexity. Our professional staff works with you and your clients to maximize the value of all contributions.
The Catholic Foundation is the primary philanthropic resource in the Diocese of Dallas. Since our founding in 1955, we have established an unparalleled reputation for integrity, stewardship, and effective grant-making. Consistent with our mission, we serve our donors with our knowledge and experience and by offering the most sophisticated philanthropic tools available. We welcome donors of all faiths and can make grants to all legally-defined charities whose work is consistent with Catholic values.
We invite you to work with us to help your clients realize their charitable and/or philanthropic goals.
The Catholic Foundation (TCF) vs. Private Foundation
Many of your clients will assume they need a private foundation to achieve their philanthropic goals. Over the years, we have found that most donors who establish funds with The Catholic Foundation enjoy virtually the same benefits that would accrue to a private foundation, but without the onerous reporting and spending requirements. A comparison follows:
Issue |
Donor Advised Fund |
Supporting |
Private |
Creating the Foundation |
Established at TCF by a simple agreement |
Nonprofit corporation or trust created with assistance from TCF |
Nonprofit corporation or trust organized as a private foundation |
Tax Exempt Status |
Shares the public charity tax exempt status as a “component” of TCF |
Shares the public charity tax exempt status of TCF |
Must apply for private foundation tax exempt status from the IRS |
Start-up Costs |
No cost to donor |
Minimal costs through collaboration with TCF |
Similar to a corporate start-up requiring substantial legal, accounting, and operational start-up costs |
Recommended Size |
$25,000 or more |
$5 million or more |
Generally $2-$5 million to justify start-up costs |
Charitable Deductions for Cash Gifts |
Tax deduction of up to 50% of adjusted gross income |
Tax deduction of up to 50% of adjusted gross income |
Tax deduction of up to 30% of adjusted gross income |
Charitable Deductions for Appreciated Property |
Tax deduction available for full fair market value of marketable securities and other property Tax deduction available up to 30% of adjusted gross income |
Tax deduction available for full fair market value of marketable securities and other property Tax deduction available up to 30% of adjusted gross in income |
Tax deduction may be taken for fair market value of marketable securities. Generally, tax deduction for other property is limited to the lower of cost or fair market value Tax deduction available up to 20% of adjusted gross income |
Donor Control |
Donor makes advisory grant recommendations – final decisions rest with TCF’s Trustees |
Donor holds significant organizational influence and may appoint minority of the board |
Private Foundation’s Trustees or Directors retain complete control over investments and grantmaking, subject to IRS requirements |
Self-Dealing Rules |
Private foundation self-dealing rules do not apply |
Private foundation self-dealing rules do not apply |
Strict regulations prohibit most transactions between private foundation and its donors (including related persons or organizations) |
Payout Requirements |
Do not apply |
Do not apply |
Must pay out for charitable purposes at least 5% of its asset value annually, regardless of its income |
Administration |
Services provided by TCF |
Affiliation with TCF provides access to existing services |
Must establish and/or obtain these services |
Operational and Grantmaking Guidance |
TCF staff available to consult with client and research charities |
TCF staff available to consult with client and research charities |
Little to no assistance available |
Annual Costs |
Minimal |
Shared by TCF and therefore kept at a minimum |
Can be costly but varies according to size and complexity of the foundation |
Annual Taxes |
Generally no tax on investment income |
Generally no tax on investment income |
Subject to an excise tax of up to 2% of net investment gain, including net capital gains and income |
Annual Tax Filing & Return (990 Report) |
Not required (reported as part of TCF’s annual reporting) |
Can be prepared and filed by TCF, or TCF can oversee preparation |
Must be filed by the private foundation with required reporting schedules |
Investments |
Fund assets are professionally invested through TCF’s various options |
May avail itself of professional investment services offered by TCF |
Must research, secure, and carefully monitor its own investment vehicles |
Fiduciary Responsibility |
TCF fulfills the associated fiduciary responsibility |
Administrative guidelines provided by TCF |
The private foundation board has fiduciary responsibility |
Liability and Risk Insurance |
Provided by TCF up to $10 million |
Provided by TCF up to $10 million |
Must be purchased by the private foundation |
Donor Advised Fund – Through an agreement with The Catholic Foundation (TCF), the fund will be set up and specially named. The fund will be managed and administered by TCF, but you will be able to choose fund advisors and advise the Foundation about preferences regarding grant recipients and gift amounts. Distributions will be made in the fund’s name, and you will receive annual financial statements. Since the fund is considered part of The Catholic Foundation’s holdings, it will receive all related tax exempt benefits.
Supporting Organization – Through a unique collaboration with The Catholic Foundation (TCF), you can form a supporting organization. Structured as a separate corporation or trust, a support organization has its own nonprofit board, bylaws, articles of incorporation and financial statements. If it is a trust, it also has its own trustees. However, by sharing management and administration with TCF, a support organization is particularly cost effective. Most importantly, it is for tax purposes a public charity, entitling its donors to the most generous tax deduction available.
Private Foundation – A private foundation allows extensive donor control over distributions and board selection. However, private foundations are highly controlled by the government with many special restrictions, including administrative and reporting burdens, excise taxes, and a required minimum payout. In recent years, significant limitations on charitable deductions available for gifts to private foundations have minimized the appeal of this tool.
Professional Advisors Handbook
The Catholic Foundation has prepared this Professional Advisors Handbook to facilitate our partnership, as a charitable foundation, with our donors’ financial and legal advisors. The Handbook details the opportunities, services and expertise the Foundation provides to assist you in achieving your clients’ philanthropic intentions.
Download Professional Advisors Handbook
The Good Advisor
The Good Advisor is a respected resource which addresses current issues and challenges regarding wealth management and estate planning. It is published quarterly and distributed free of charge by The Catholic Foundation to financial and legal professionals in the Dallas community.
GiftLaw
GiftLaw is the ultimate resource for professional advisors whose clients may consider including charitable giving in their estate or financial plans. Included in this helpful, user-friendly section are:
- The latest tax and estate updates from Washington,
- Articles of current interest to estate planners and financial advisors,
- GiftLaw Pro: A comprehensive library of information, regulations, private letter rulings and cases for professionals, and
- A gift calculator to run charitable deduction calculations for most popular gift plans.
To access GiftLaw, click here.
If you would like your name, or your firm, to be added to The Catholic Foundation's Professional Advisors' mailing list, please click here.