Public Charity vs Private Foundation vs Private Operating Foundation | How to Start a Nonprofit

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One of the most important early steps in starting a nonprofit is deciding what type of nonprofit you will be. There are two main types of nonprofits: public charities and private foundations. In this video, we will discuss the differences between the two, including potential IRS consequences. We also throw in a third type: private operating foundations.

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All videos are for educational and entertainment purposes only. This is not legal advice and should not be relied on as such. Every case is different. Consult a licensed professional in your state. Mark Lyda is a Colorado-licensed attorney. Viewing this channel or its content does not create an attorney-client relationship with Lyda Law Firm or any of its lawyers.

#nonprofit #publiccharity #privatefoundation

[truthstation]

Thanks for this understanding. Much appreciated!

[ConzJacks]

Great video, thanks for sharing. Need your opinion please 🙏
Our community group started in 2000. Recently we were granted the charity status, it's been the hope of members since 2000. Now that we have the charity registration, some of the members disagreed so they left & started a new group this year. My question is can they carry on celebrating the anniversary foundation day?

[shortishperson]

Thanks for a your great over view video! I appreciate the breakdown of 3 categories. Can you do a video on Private Operating Foundations please? There seems to be a dearth of information on the internet when it comes to that type of organization since they are less common. Would be great to understand why one would choose to form that type of entity over a public charity. Are there any activities that Private Operating Foundations are not allowed to perform or that would lead them to losing their 501c3 status?

[juanmosqueda]

Great video, it answered most of my questions. At the end of the video you suggest that we contact a lawyer, could you direct me to which type if lawyer I would need?

[thealabasterbox]

So...it sounds like if I'm trying to lower my tax, it's better to just donate to my favorite charities instead of trying to set up a public or private foundation...right?

[MarcusJFloyd]

Can you switch between nonprofit types at a later date?

[mountcarmelworshipchurch-m]

Wow, thank you so much for the insightful information. My question is, I want to start a Cancer foundation, called hope. I want it to be registered in my name, but i would be asking for donations from absolutely anywhere i can get. How do i go about that? Does it mean i must register it as a NPO?

[socalfierceball]

Thanks for your help clarifying. We are amateur sports club and fall under "public charity" however, I am a bit confused on the form 1023 question where it ask if we normally receive at least one-third of your support from public sources or you normally receive at least 10% of your support from public sources and you have other characteristics of a publicly supported organization. Or
normally receive more than one-third of your support from a combination of gifts, grants, contributions, membership fees, and gross receipts (from permitted sources) from activities related to your exempt functions and normally receive not more than one-third of your support from investment income and unrelated business taxable income. We are currently not exempt but we hope to receive grants to offer student athlete workshops on how to prepare for college etc so it makes it confusing as to which one to choose. Any advice on this?

[JayleeOCO]

thanks so much! the broad distinctions were really helpful (:

[PratimaShri]

If I wanted to start something to fund students tuition or help pay their fees, what is the best way to start this? Would be private or Public charity?

[Missmonealot]

you wrote in the title public operating foundation but you kept saying private operating foundation. Which one is it?

[ronl.brooks]

how can you go back and change from private to public charity,

[muhsinalie]

Good video Mark! Great production value especially nice audio :D Quick question...can you create and operate any of the 3 organizations in your video and get tax exemption in California if the charity benefits people in a foreign country?

[erikbrown]

Is there more asset protection in a private family foundation and can there only be a ceo in a family foundation just one person to run it

[donovanworking]

I want to start a foundation or non-profit for my 16 year old son and other parents out there like me. My son is severely intellectually disabled and needs a lot of daily care including bathing, feeding, changing poops, etc.... When I die he will become a ward of the state. The state pays minimum wage to those who would be caring for my son. Minimum wage brings in people that are inexperienced, underpaid, and don't have the heart it takes to care for individuals like my son. Since I am a teacher and don't make enough money to put away to ensure his future, I want to start a non-profit or foundation. Please help me with this. Please. Donovan

[truthstation]

Except for the Bill and Milinda Foundation! nothing to see there.

[DesignsByXclusive]

This is confusing. I dont want any problems with the IRS. Guess I'll need a lawyer

[gloryofjesuschristministri]

Please help to Christian poor people from India🇮🇳