What is the difference between a public charity and private foundation?
All organizations which apply for tax exemption under 501(c)(3) are either classified as “public charities” or “private foundations.” A 501(c)(3) tax-exempt organization is classified as a “private foundation” unless it falls under one of three exceptions, in which case it is classified as a public charity: (1) by virtue of its activities (churches, schools, hospitals, and a few others); (2) it is organized and operated exclusively for the benefit of, to perform the functions of, or to carry out the purposes of, a public charity; or (3) it can show that it is “publicly supported” (which generally means receiving financial support from a broad group of funding sources). With regard to “publicly supported” public charities, the determination of whether an organization is publicly supported is based initially on the information provided by the Organization on its Application for Tax Exemption (IRS Form 1023) and then on the informational tax returns filed annually with the IRS (IRS Form 9
