As you work with clients who have established private foundations, it’s not unusual for the conversation to shift over time: Does this still make sense?
What once served as an effective vehicle for family philanthropy can become increasingly complex to manage—especially as leadership transitions to the next generation. In many cases, transferring assets to a donor-advised fund at BRAF offers a simpler, more flexible path forward.
You’re likely familiar with the advantages. A donor-advised fund can reduce administrative burden, eliminate many tax compliance requirements, and allow families to focus more fully on their charitable goals rather than ongoing operations.
The mechanics are straightforward
In most cases, the transition follows a clear path:
- Secure board approval and document the decision to terminate
- Establish a donor-advised fund, often reflecting the foundation’s name and intent
- Grant most remaining assets to the new fund, reserving funds for final expenses
- Settle liabilities and complete final tax filings and dissolution requirements
While these steps matter, the transition is about more than process. It’s an opportunity to reposition a family’s philanthropy for the future—reducing complexity while preserving, and often enhancing, impact.
Don’t overlook communication
One of the most important—and often overlooked—aspects of this transition is communication with nonprofit partners.
Many private foundations have supported the same organizations for years, sometimes decades. Without clear communication, a transition can create uncertainty for nonprofits that rely on that support.
As a trusted advisor, you can help clients approach this thoughtfully. We can also serve as a resource, given our close relationships with nonprofits across the region.
Five tips for a strong communication plan
- Start early. Encourage clients to communicate proactively with key grantees.
- Keep it simple. A clear message explaining the transition—and continued commitment to giving—is enough.
- Make it personal. A quick call or personal outreach before sending formal communication builds trust.
- Reassure where appropriate. If support will continue, let nonprofits know grants may now flow through BRAF.
- Provide context. Position the move as a way to strengthen impact, supported by the BRAF’s broader resources and network.
The bottom line
Transitions like this are both technical and relational. With thoughtful planning—and clear communication—clients can move to a more efficient structure while maintaining the trust and impact they’ve built over time.
As always, our team is here to help you and your clients navigate every step of the process.