What are the available tax deductions when donating to a private foundation? How do individuals benefit from setting up a private foundation?
Under the Internal Revenue Code, contributions to a private foundation are eligible for an itemized deduction on the date that the charitable contribution is made to a foundation, subject to the general limitations. The deduction will depend, in part, on the type of asset that is contributed. You should consult your legal or tax advisor for more information about your personal situation. Donations to a private foundation are generally eligible for an itemized deduction for cash contributions of up to 30% of adjusted gross income (AGI) in the tax year in which the contribution is made. Deductions for contributions of appreciated securities held for more than one year are limited to 20% of AGI. Any excess amount may be carried forward and deducted in the five-year period after the contribution. The ability to deduct itemized donations may be subject to certain other limitations. Please contact your tax advisor to determine your tax deductibility limits.
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