The following is an excerpt from Ice Miller's Business Transition Strategies to Preserve Wealth
Guide, which provides insights on a variety of topics to help
ensure a smooth business transition.
Generally, no. Most states provide procedures for forming a
private foundation and receiving exemption from state income taxes.
More importantly, the federal tax benefits (e.g., the tax-exemption
for the foundation and the charitable deduction) apply no matter
where the private foundation is formed. Therefore, a private
foundation can be formed in any state and can continue to do
business, plan events and operate in any other state.
In sum, a donor and his or her advisors need to understand and
comply with the state laws where the private foundation forms and
operates. Ice Miller represents clients nationally and worldwide.
In addition, we routinely apply the federal tax-exempt rules to
private foundations in various states. Therefore, we are prepared
to assist donors with
