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Giving to Make a Difference |
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The BLACKNJ Giving Glossary is a resource that enables you to define philantropic
terms you may find in a Featured Organization's detail page. Browse through
or click alpha links to jump term:
Payout Requirement
The minimum amount that a private foundation is required
to expend for charitable purposes (includes grants and
necessary and reasonable administrative expenses). In
general, a private foundation must pay out annually approximately
5 percent of the average market value of its assets.
Philanthropy
Philanthropy is defined in different ways. The origin
of the word philanthropy is Greek and means love for mankind.
Today, philanthropy includes the concept of voluntary
giving by an individual or group to promote the common
good. Philanthropy also commonly refers to grants of money
given by foundations to nonprofit organizations. Philanthropy
addresses the contribution of an individual or group to
other organizations that in turn work for the causes of
poverty or social problems-improving the quality of life
for all citizens. Philanthropic giving supports a variety
of activities, including research, health, education,
arts and culture, as well as alleviating poverty.
Pledge
A promise to make future contributions to an organization.
For example, some donors make multiyear pledges promising
to grant a specific amount of money each year.
Post-Grant Evaluation
A review of the results of a grant, with the emphasis
upon whether or not the grant achieved its desired objective.
Preliminary Proposal
A brief draft of a grant proposal used to learn if there
is sufficient interest to warrant submitting a proposal.
Private Foundation
A nongovernmental, nonprofit organization with funds (usually
from a single source, such as an individual, family or
corporation) and program managed by its own trustees or
directors, established to maintain or aid social, educational,
religious or other charitable activities serving the common
welfare, primarily through grantmaking. U.S. private foundations
are tax-exempt under Section 501(c)(3) of the Internal
Revenue Code and are classified by the IRS as a private
foundation as defined in the code.
Public Charity
A nonprofit organization that is exempt from federal income
tax under Section 501(c)(3) of the Internal Revenue Code
and that receives its financial support from a broad segment
of the general public. Religious, educational and medical
institutions are deemed to be public charities. Other
organizations exempt under Section 501(c)(3) must pass
a public support test (see Public Support Test) to be
considered public charities, or must be formed to benefit
an organization that is a public charity (see Supporting
Organization). Charitable organizations that are not public
charities are private foundations and are subject to more
stringent regulatory and reporting requirements (see Private
Foundation).
Public Foundation
Public foundations, along with community foundations,
are recognized as public charities by the IRS. Although
they may provide direct charitable services to the public
as other nonprofits do, their primary focus is on grantmaking.
To be eligible for membership in the Council, a public
foundation must grant at least $60,000 yearly and must
dedicate at least 50 percent of its organizational budget
to a competitive grantmaking program.
Public Support Test
There are two public support tests, both of which are
designed to ensure that a charitable organization is responsive
to the general public rather than a limited number of
persons. One test, sometimes referred to as 509(a)(1)
or 170(b)(1)(A)(vi) for the sections of the Internal Revenue
Code where it is found, is for charities like community
foundations that mainly rely on gifts, grant, and contributions.
To be automatically classed as a public charity under
this test, organizations must show that they normally
receive at least one-third of their support from the general
public (including government agencies and foundations).
Restricted Funds
Assets or income that is restricted in its use, in the types of organizations
that may receive grants from it or in the procedures used to make grants
from such funds.
Seed Money
A grant or contribution used to start a new project or
organization.
Self-Dealing
A private foundation is generally prohibited from entering
into any financial transaction with disqualified persons
(see Disqualified Person). The few exceptions to this
rule include paying reasonable compensation to a disqualified
person for services that are necessary to fulfilling the
foundation's charitable purposes. Violations will result
in an initial penalty tax equal to 5 percent of the amount
involved, payable by the self-dealer.
Site Visit
Visiting a donee organization at its office location or
area of operation and/or meeting with its staff or directors
or with recipients of its services.
Social Investing
Also referred to as ethical investing and socially responsible
investing, this is the practice of aligning a foundation's
investment policies with its mission. This may include
making program related investments and refraining from
investing in corporations with JOBS or policies inconsistent
with the foundation's values.
Supporting Organization
A supporting organization is a charity that is not required
to meet the public support test because it supports a
public charity. To be a supporting organization, a charity
must meet one of three complex legal tests that assure,
at a minimum, that the organization being supported has
some influence over the actions of the supporting organization.
Although a supporting organization may be formed to benefit
any type of public charity, the use of this form is particularly
common in connection with community foundations. Supporting
organizations are distinguishable from donor-advised funds
because they are distinct legal entities.
Tax-Exempt Organizations
Organizations that do not have to pay state and/or federal
income taxes. Organizations other than churches seeking
recognition of their status as exempt under Section 501(c)(3)
of the Internal Revenue Code must apply to the Internal
Revenue Service. Charities may also be exempt from state
income, sales and local property tax.
Technical Assistance
Operational or management assistance given to a nonprofit
organization. It can include fundraising assistance, budgeting
and financial planning, program planning, legal advice,
marketing and other aids to management. Assistance may
be offered directly by a foundation or corporate staff
member or in the form of a grant to pay for the services
of an outside consultant.
Tipping
The situation that occurs when a gift or grant is made
that is large enough to significantly alter the grantee's
funding base and cause it to fail the public support test.
Such a gift or grant results in "tipping" or
conversion from public charity to private foundation status.
Trust
A legal device used to set aside money or property of
one person for the benefit of one or more persons or organizations.
Trustee
The person(s) or institutions responsible for the administration
of a trust.
Unrestricted Funds
Normally found at community foundations, an unrestricted
fund is one that is not specifically designated to particular
uses by the donor, or for which restrictions have expired
or been removed.
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| DISCLAIMER:
BLACKNJ, Inc., BLACKNJ Giving Back, Inc. and its agents do not endorse either the organizations or the volunteer opportunities identified on this web site; nor make any warranty regarding the contents of the organizations or the philanthropic opportunities, and will not be liable for any loss, damages, or injury to persons or property in any manner arising out of or incident to the use of the website, including any consequential damages. All logos and images used to visually depict listed organization are the property of the respective organization. |
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| © 2005 BLACKNJ, Inc. All Rights Reserved |
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