Since I had his ear anyway, while talking with the serial entrepreneur at lunch, I asked him about our legacy planner’s 501(c)(3) proposal.

He didn’t like the idea. From a governance perspective, he didn’t like the idea. Having to report everything the way a 501(c)(3) is required to report it on the standard form 990: that doesn’t look too attractive, either. “But, honestly,” he said, “I really haven’t looked into the 501(c)(3) idea. . . . Your legacy planner probably knows something I don’t.

“However,” he continued, “you may want to talk with _______ of the National Christian Foundation. NCF has something I’ve heard about. I think it’s called an ‘LLC wrapper’ or something. You put your company into an LLC that one of NCF’s donor advised funds owns, and then, I believe, all your profits can go to the charities of your choice. Something like that. . . .”

He didn’t really know the details on that, either. But the vague outlines of the idea make some kind of sense. It is my understanding that a DAF can own shares in companies. Why can’t they own the whole company and take all its profits?

Now to find someone who will explain the “LLC wrapper” (or whatever it’s really called!). Happily, the president of NCF is here at the Generous Giving conference. Maybe he can help me!

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This entry was posted on Friday, April 18th, 2008 at 2:42 pm and is filed under corporate forms, estate planning, legacy planning, structures. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.