Foundation Source, a US provider of support services for private foundations, has developed a free, online compliance assessment for private non-operating foundations.

Foundation Source, a US provider of support services for private foundations, has developed a free, online compliance assessment for private non-operating foundations. 

The online assessment involves a series of “yes/no” questions and helps private foundations remain compliant by identifying “yellow-flag” activities that could increase the foundation’s exposure to risk, the firm said.

These activities fall into areas around which IRS regulations can be particularly complex. Some of these areas, Foundation Source added, include: Compensating disqualified persons; failing to meet the annual minimum distribution requirement; granting to foreign organizations; maintaining bank accounts outside the US; making grants via an intermediary; over-paying foundation taxes; owning an interest in a privately-held company or partnership; and owning real estate.

Once respondents submit their answers, they receive a report via email that highlights the activities that could increase the foundation’s exposure to risk. The report will outline and explain the specific rules governing each of those activities, as well as potential penalties for non-compliance.

“The tax rules governing private foundations can be complicated, and if foundations are not aware of these rules or don’t understand them, they expose themselves to risk,” said Foundation Source’s chief legal officer, Jeffrey Haskell.

Foundation Source is headquartered in Fairfield, CT, with offices in Denver, Los Angeles, New York City, Philadelphia, San Francisco, South Florida, Washington, DC, and Winston-Salem.