CFO Hosts Professionals Advisors Council for Annual Breakfast

Attorney Thomas D. Peebles, Jr., talks about donor-advised funds vs. private foundations.

The CFO welcomed members of its Professional Advisors Council today for an annual breakfast, which featured attorney Thomas D. Peebles, Jr. talking about the differences between public and private foundations.

Peebles, with Carnahan, Evans, Cantwell & Brown, PC and a former CFO Board Chair, described the distinctions between setting up a private foundation for a client and establishing a donor-advised fund at a community foundation.

It is much less expensive to set up a donor-advised fund than a private foundation, he said. The costs of establishing a private foundation aren’t really justified unless the donor plans to open it with $1 million or more, he said. There is no cost to establish funds at the CFO and the 1 percent administrative fee covers all of the back-office services, distributions from the fund and investment management. Donor-advised funds can be established at the CFO with a minimum of $25,000.

If donors are interested in iron-clad control over their funds, or want to hire their own staff, such as family members, then a private foundation may be more appropriate, Peebles told the group of about 40 financial,  legal and insurance professionals who work in estate planning and wealth management.

But donor-advised funds allow donors privacy if they wish to make anonymous gifts, don’t  have any annual distribution requirements and give donors access to information about community needs and priorities through the CFO’s grantmaking work.

“I would suggest that a donor-advised fund, particularly at donor-advised fund at the CFO, is a choice that would accomplish just about every objective a donor might have,” Peebles said.