Feb 1, 2012 12:00 PM

By Laura H. Peebles

When establishing a new private foundation, one of the toughest questions the founders should answer is, “Who will run the foundation after we're gone?” Perhaps because it's a difficult question, some founders decide to defer the answer — sometimes indefinitely. As a result, their foundations include generic successor provisions that satisfy state law and Internal Revenue Service requirements, but may not serve the foundation well in the long run.

The alternative to forethought is waiting until a crisis occurs and then responding to it. Unfortunately, that approach may lead to potential penalties when the surviving board member or members become ill, elderly or inattentive to their family foundation's many operating requirements. The neglect may only come to light as the children start to take over their parents' financial affairs, adding additional stress to what's often an awkward transition. Like so many difficult questions in life, the problem of a successor's control and management of a foundation is better addressed before it becomes a crisis.

Topics of Interest

Estate Tax	Donor Advised Funds
GSTs	Family Offices
Private Foundations	Life Insurance
2010 Tax Act News	Industry Trends Surveys

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Topics of Interest

Estate Tax	Donor Advised Funds
GSTs	Family Offices
Private Foundations	Life Insurance
2010 Tax Act News	Industry Trends Surveys

E-Newsletter Signup

2011 Trust Glossary

Click here to download the 2011 Trust Glossary

50 Years Ago This Month

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50 years ago, in May 1962, we featured articles such as: "Future of Canadian Trusteeship" by Arthur H. Mingay", "Training Trust Employees" by Ian M. Marr, "What is a Trust Officer?" by Eric J. Brown, and "Selling Services" by Donald I. Webb.

Conrad Teitell's Guide to Tax Benefits For Charitable Gifts

Click here to view the most up to date guide (September 2011)

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