What is Foundation Source and why are you offering GrantSafe?
Foundation Source is the nation’s largest provider of support services for private foundations. One of the services we provide to our clients is verification that the nonprofits their foundations grant to have been approved by the IRS as public charities and currently are in good standing.
To this end, we developed a proprietary database of 501(c)(3) public charities, which is constantly updated with additions and revocations as listed in IRS publications.
In June of 2011, the IRS revoked the charitable status of more than 275,000 U.S. nonprofits because they failed to file a tax return three years in a row. This caused confusion as to which organizations were still valid public charities, and created a significant concern. If a foundation donates to one of these suspect organizations, which it may have legitimately supported in the past, the foundation could now face a 20% penalty on the amount of each grant.
We believe that no philanthropists should be penalized for their good intentions. Therefore, Foundation Source decided to offer GrantSafe at no cost to the larger foundation community as part of our mission to encourage safe, sound and responsible philanthropy.