A foundation is a non-profit company that supports charitable activities in order to help people in need. Foundations are usually funded by endowments or donations, which can be money donated by individuals, families, or corporations. This type of foundation is usually funded by income from endowments.
A few foundations have great discretion in deciding which charities they will grant grants to. Some foundation firms have very strict guidelines and are limited in their ability to grant funds to specific causes. Others have to restrict the grant-making to a specific geographic area.
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Foundation companies may run programs in-house, which is different from other corporate businesses. They are completely under the control of the company and are not subject to the same IRS rules. Foundation is publicly funded and benefits a specific geographic area or community.
There are many types of grant-making foundations. The Independent Foundation, which is typically the most common, is a private organization. These foundations are often started by one person or a group of people. They must be managed by the donor or their family members. This type is sometimes called a family foundation, or one that is run by an independent third-party board.
The next category is Corporate Institutions. They are created and funded by companies as distinct entities. They are overseen by a board of directors, which is most often comprised of employees within the company. They may also make a contribution from profits or use a combination of both to fund foundation resources.