Foundations and Charities

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Chapters in this video

  1. 0:00 Meet Avery: three clients, three charitable vehicles
  2. 0:50 Fiona's private foundation: control costs 5% and 1.39%
  3. 3:37 Penelope's public charity: the 60% AGI advantage
  4. 5:01 Dan's donor-advised fund: recommend, not compel
  5. 7:11 Side-by-side exam showdown matrix
  6. 8:14 Rapid-fire exam recap

What this video covers

  • Why private foundations must distribute at least 5% of net investment assets annually, and why this rule never applies to public charities or donor-advised funds (DAFs)
  • How the 1.39% excise tax on net investment income functions as a penalty exclusive to private foundations
  • The funding source distinction that drives all other rules: single source (private foundation), general public (public charity), or individual donor through a sponsoring organization (DAF)
  • Why public charity donors enjoy a 60% adjusted gross income (AGI) deduction limit for cash versus only 30% for private foundation donors
  • The precise legal meaning of "recommend" in a DAF, and why donors cannot legally compel or control grant decisions
  • Why DAFs offer immediate tax deductions at contribution, low setup complexity, and no minimum distribution requirements
  • How to read the entity comparison matrix instantly for rapid-fire elimination of wrong answer choices on test day

Read the full lesson, free

This video's complete written lesson is free to read in the CertFuel app, no signup wall. The complete Series 65 course also includes adaptive practice questions and spaced-repetition flashcards, free through December 31, 2026.

Read the Free Lesson → free · no signup wall