Rusk County Community Foundation Frequently Asked Questions


What is a community foundation?

Community foundations are independent, tax-exempt public charities created by and for the people in a local area. They enable people with philanthropic interests to support the issues they care about, easily and effectively. The create long-term assets for communities to sustain the people who live there. Working within a specific geographic area, community foundations build permanent funds, through a gift of assets contributed by many donors. From those funds, community foundations make grants and engage in community leadership activities to address a wide variety of current and long-term needs. An exciting aspect of community foundations is their ability to respond to changing conditions, quickly enough to be effective, but always reflecting the objectives of the donor. As a neutral, nonpartisan entity, the Foundation can often serve as a catalyst to spearhead new projects and programs that meet important community needs.

What is the difference between a Community Foundation and a Private Foundation?

Community Foundations are simpler and often more economical than a private foundation. A named donor advised fund through a community foundation is like having a “foundation within a foundation.”

While enjoying the fun of recommending grants (subject to Board approval), the donor
avoids excess regulatory rules, excise taxes, accounting and legal fees, tax reporting, managing investments, audits or other federal reports. The above is often a good alternative for those thinking of a private foundation but do not have several million in assets. There is a loss of control, however, as the community foundation will reserve variance powers to insure that all processes are legal, that grants go to charitable organizations/projects and that the donor is making grants consistent with their purpose
statement.

Private Foundations maintain total control of their assets. To keep up with and follow the laws, they will often opt to hire administrative and legal staff to coordinate the efforts of their foundation. While there is no magic number, the efficiency of a private foundation is gained only when very large assets are being managed.

How was the RCCF formed?

The RCCF was formed after a life long resident of Rusk County made provisions to start a community foundation in Rusk County. This initial donor wished to create a permanent organization that would bring together those individuals who wanted to give back to their local community, with the causes that they cared most about. Because of the initial donor’s very generous start up gift, all donors now have a means for leaving a meaningful gift that will last in perpetuity, and local non-profit organizations have a source to fund their very important and worthwhile causes.

Is the RCCF a fundraising organization?

The Foundation is not like other charitable organizations in the Rusk County area. The Foundation seeks substantial gifts from a limited number of individuals. The Foundation does not compete with other non-profits for operating expenses and does not engage in the traditional fundraising conducted by most local charities. Unlike other local charitable organizations, the Rusk County Community Foundation will provide grants to many of the local non-profits to help them to carry out their work in the community. The Foundation applies its funds to as many community needs as possible, unlike most charitable organizations that exist to support the needs of a single cause.

Is the RCCF affiliated with the County?

No. Although a public organization, we are completely independent and have no connection with any government entity. However, on occasion the foundation will be involved with projects that government bodies are a part of.

Why work through the RCCF?

Convenience. Local expertise. Permanent giving. Tax advantages. We work with you to make charitable giving as easy as possible. We have a strong board of directors consisting
of local community leaders. We know the communities and our local nonprofit organizations and changing needs.

An endowment can serve to teach philanthropy to your children and continue your giving in perpetuity. We are dedicated to carrying out your charitable wishes today and
for generations to come.

How is the RCCF governed?

The Foundation is governed by a volunteer board of directors who are chosen because of their demonstrated commitment to and knowledge of the needs of the community. The Board elects its officers, and each board member is appointed to serve a three year term.

Where is the RCCF office?

The Rusk County Community Foundation office is located at 100 W. 2nd St. N. in Ladysmith, at the ReMax Real Estate office in the Old Pioneer Bank building. The Foundation has a mailing address of P.O. Box 54, Ladysmith, WI 54848.

How can I contact the RCCF?

The RCCF can be contacted by email at info@ruskfoundation.org or by phone at (715) 532-0772. In addition any board member can be contacted for more information.

How does the RCCF operate? Where does the RCCF get its funds?

The Rusk County Community Foundation receives its contributions from individuals, businesses, and private foundations. Current gifts and bequests make up the permanent endowment of the Foundation. income from these gifts is used to make grants.

Is this only for rich people – How can I afford to give?

No, the Rusk County Community Foundation accepts contributions of all sizes. Your contributions can be combined with those of others who share your charitable interests to provide maximum impact to the community at a minimum administrative cost. Many people choose to make small gifts to the Foundation in honor of, or in memory of a family member, friend, or loved one. The Foundation will send acknowledgments to the person being honored or to the family of the person being remembered and will also send thank you notes and appropriate tax receipts to the donors.

What are the ways of giving and what are the types of funds?

Cash Direct gifts of cash (or checks) are a convenient way to establish a fund.

Securities Stock can be donated to and sold in the Foundation’s name. The donor is allowed the full value as a charitable income tax deduction, but pays no capital gains taxes on the sale of the stock.

Personal Property or Real Estate Personal property or real-estate can be donated in the same manner and tax advantages as securities.

Will Bequests When making a will, and after providing for loved ones, you may also make a gift to the Rusk County Community Foundation. Your gift may be a specified amount, a percentage of your estate or specific assets.

Life Insurance You may designate the Rusk County Community Foundation as the owner and beneficiary of a new or existing life insurance policy. Insurance premiums paid by the donor are deductible as a charitable contribution.

Charitable Remainder Trusts You may transfer assets to a Charitable Remainder Trust. This trust provides for payment of a fixed income to you, a spouse, a disabled person or other loved ones. This trust enables the donor to provide a lifetime personal income and income for beneficiaries for a specified period or death of the last heir. The assets are then transferred to your fund in the Rusk County Community Foundation.

When is the best time to give?

Whenever you are ready. . . You can establish a fund now and add to it whenever you like. You may choose to give as a bequest from your will. You may want to make contributions to any of our funds in honor of or in memory of someone. Hopefully, you will also respond to our annual solicitation for contributions demonstrating public support of the Foundation.

How are funds created and managed?

The board of directors assists Donors in creating, or contributing to charitable funds of causes the donor wishes to support. Donors may contribute tax-deductible gifts of cash, stocks, real estate or other property. All funds are pooled and prudently invested by money managers that are approved by the Foundation’s Board of Directors. A percentage of the money in each permanent fund is available annually for grants that support the work of nonprofit organizations serving Rusk County. The principal grows right here at home building gifts that keep on giving.

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Commonly Asked Questions About Giving and Starting a Foundation Fund

Can I give a gift on behalf of someone else?

Anyone can contribute any amount to any fund at the Rusk County Community Foundation. Many people choose to make small gifts to the Foundation in honor of, or in memory of a family member, friend, or loved one. The Foundation will send acknowledgments to the person being honored or to the family of the person being remembered and will also send thank you notes and appropriate tax receipts to the donors.

Can I involve my financial advisor or attorney?

Absolutely. We often work with area professional advisors to make sure that donors get the greatest tax advantages from their charitable giving.

In fact, your professional advisor is often in the best position to determine the right financial vehicle for your family as well as your charitable interests.

Once you have made your decisions and are comfortable sharing your ideas, we look forward to sitting down with you and your adviser to work things out in the most efficient
and effective manner for you to give.

Are their tax advantages to giving?

All gifts to the Rusk County Community Foundation are tax deductible to the full-extent of the law. Gifts of cash and ordinary income property to a Community Foundation are deductible up to 50% of adjusted gross income. Gifts of appreciated property can be credited for up to 30% of adjusted gross income. Remember, too, that gifts of appreciated property (stock, real estate, etc.) are deducted at the full appreciated market value, not the low basis price and no capital gains taxes are due.

What is an endowment?

An endowment is a fund that is kept in perpetuity. The original contribution is invested and only the investment income and gains from the investment are used to support the charitable grants. The original contribution stays, intact, and continues to grow and generate charitable dollars.

What are the types of funds?

When deciding to establish a fund, you must decide what your charitable dream is. Once you know what organization or charitable purpose you might want to support, you may choose from the following four choices:

Undesignated Fund: Undesignated funds are granted at the discretion of the Rusk County Community Foundation’s Board of Directors who determine where the most needs are in the community. Undesignated funds offer great flexibility in
meeting existing and future community needs.

Designated Fund: The donor names the charity or charities to receive the income from the fund.

Field of Interest Fund: The donor specifies that income from the fund be used to support a particular area of community life, such as the arts, social services, education, the environment, the elderly, youth. Donor Advised Fund: Within certain guidelines the donor may make suggestions on grant distributions from the fund. A donor advised fund allows the donor(s) to continue on as an active participant in the fund’s grantmaking. With a donor advised fund, a donor may support varying causes from year to year as donor’s choices or community needs change. Donors may also use their donor advised endowment fund with “pass-through” privileges to make larger contributions than the income generated by the fund’s endowment investments.

Scholarships: Scholarship funds allow donors to invest in the community’s future. These funds provide support for individuals pursuing training or educational opportunity. As part of the fund, donors can specify certain elegibility criteria, such as the school(s) student must graduate from or be admitted to. Special project/pass through funds: These funds are generally established for limited purposes and are not permanent.

How do I establish a fund?

Establishing a fund is easy. Because the legal apparatus is already in place, community foundations have appropriate forms available so that a fund can be established and the tax advantages obtained quickly and easily. Foundation personnel can meet with you to learn about your charitable intentions. Your fund can be named to honor your family or the charitable intention you wish your fund to support. Foundation personnel will explain the kinds of funds that can be established and the variety of ways to give.

A simple fund agreement is crafted by the Rusk County Community Foundation staff for each new fund.

How much money is required to start a fund?

A $5,000 gift will establish a named fund or endowment.

An Acorn Fund is also possible. Acorn Funds allow donors to build meaningful permanent funds over time with an initial contribution of $1,000. All contributions are accumulated until the donor’s goal for the fund is realized. Once a fund is established, any amount may be added as a gift, memorial or bequest.

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Commonly Asked Questions About Foundation Grants

How are grant recipients chosen?

Grant recipients are chosen in different ways, depending upon the type of fund.

Donor Advised Funds allow donors, and successors they choose, flexibility to recommend how the grant money is spent. Pursuant to IRS regulations, the board of directors
has the final approval for all grants. While every attempt will be made to follow a donor’s wishes, however, the board cannot approve a donor recommendation that would place the Foundation in jeopardy of losing its status as a 501C3 organization.

Designated Funds provide donors with a way to recommend annual grants to one or more charitable organizations. Scholarships are included in this category.

Donors who want to support the changing needs of a particular cause, such as the arts, women’s issues, the environment, etc., may set up a Field of Interest Fund. Most grants are awarded through a competitive application process that is determined by the board.

Donations to a Non-restricted Fund are distributed through an annual competitive grants process. The Grants Committee recommends the projects for approval by the Board of Directors.

Supporting Organization Funds have their own boards and award their own grants, with the Community Foundation handling the financial and administrative work. Often smaller
family foundations fall into this category.

When are grants distributed?

Grant distribution shall be determined by the board of directors. Grant application procedures will be publicized locally. The Rusk County Community Foundation values all efforts to give back to the community and will work with all individuals, families, foundations or organizations in any way possible to maximize our ability to collectively make this community the best place in which to grow, to work, to play and to retire.

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