foundation or corporation?
October 18, 2005 1:58 PM   Subscribe

We want to set up an organization to promote medical exchange between American and foreign physicians. Which would be the more appropriate vehicle, a foundation or a not-for profit corporation?

Our goal is to solicit money from foreign foundations, companies and philanthropic organizations and then organize the exchanges--pay for airfare, lodging, perhaps a stipend. Which is easier to set-up and provides more flexibility?
posted by mert to Work & Money (7 answers total) 1 user marked this as a favorite
Just a thought, but I would contact the Department of State and see what works the best with their alien physician visa requirements.
posted by Pollomacho at 2:08 PM on October 18, 2005

This may be incorrect... but I didn't realize that there was a difference between a foundation and a non-profit corporation.

Isn't it just a square v rectangle problem?
posted by silusGROK at 2:25 PM on October 18, 2005

You might be right. I think a foundation is a particular type of not for profit.
posted by mert at 3:15 PM on October 18, 2005

The term "foundation" in common language implies (a) an endowment, and (b) providing funds to other non-profits, via grants, rather than directly providing a service. That's not what you want.

IRS regulation 501 c (3) is relevant - you want to create a charitable organization.
posted by WestCoaster at 4:23 PM on October 18, 2005

If you don't yet know what a foundation is, vs. a not-for-profit corporation, I respectfully suggest that you may not be ready to lead this effort.

Your first order of business should be to recruit an advisory board with experience in this type of charitable work to help you put an operational plan together. Until then, you should plan on having a budget of zero because you're might do more harm than good from a legal and financial perspective.

I might suggest starting at your local Red Cross branch and/or hospital administration for candidates.
posted by mikewas at 5:13 PM on October 18, 2005

I'm in the nonprofit/philanthropic biz (albeit not in the US) and my advice to people wanting to set up any organisation to solicit funds from others is always to firstly see if anyone else is already carrying out a similar project. Duplication of services is a big concern for most grantmaking foundations. I'd also advise you to carry out some kind of feasibility study to see whether there really is a funding base out there for the organisation - not just from philanthropic sources. Keep in mind that most foundations and even corporations will not fund a program on a recurring basis and so you'd be constantly looking for further sources of funding.

It would be to your advantage to find ways for the organisation to earn some funds if you had a lean year. The pool of available funding does grow, but there are also many, many nonprofit organisations out there competing for that funding and it's never a good thing to add another organisation with its admin and resource needs to that group without making sure there really is a gap that needs to be filled.

The other thing to keep in mind is that many foreign foundations will not be able to fund a US-based organisation. Tax and charity laws will vary from country to country but in many places they will prohibit charitable funds being sent out of the country; trust deeds of many foundations will also prohibit money going to a foreign organisation; and lastly, you'll have to fight a perception that the US is a western country with a very strong and wealthy philanthropic culture and that therefore there is no need for overseas organisations to fund you. (I'm not saying that perception is necessarily true, nor that the project would not be of advantage to other countries to fund - just that you will have to fight that perception).
posted by andraste at 6:20 PM on October 18, 2005

I really appreciate your comments. Our group's goals are pretty narrowly defined, I'm sure we're not duplicating anyone else's services. I guess we'll have to check with the various foreign foundations before we pay a lawyer to incorporate, it would definitely be a deal breaker to find out that we're not fundable. Thank you again.
posted by mert at 7:56 PM on October 18, 2005

« Older whats up with google   |   How can I identify the model number of a... Newer »
This thread is closed to new comments.