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NOTE FROM
JANIS IAN
Pearl at Goddard
PEARL FOUNDATION - TAX STATUS

From Janis Ian - Our IRS status has changed for the better!

(Tax returns and IRS letter are at bottom)

When we held our first auction, back in 1998, none of us understood the difference between a "private foundation" and a "public foundation". And when we became a legal 501(c)(3) entity under IRS rules a year later, we were held as a private foundation because the bulk of monies being donated came directly from me and my partner, Pat.

Since we have no staff, we never applied for grants, or to places like Amazon Smiles, until a few years ago, when a couple of fans mentioned that their workplaces offered matching funds, and that they'd also like to see us getting the benefits of in-kind donations and percentages offered by some on-line stores. When I applied to Amazon Smiles, I discovered they only worked with public foundations, so we were not eligible.

Why is that? Well, here's my own naivete. I had no idea that some people form private foundations mainly to pay themselves and their friends and families huge salaries, eating up most of the "charitable contributions". They expend what's legally required on charity, and not a penny more. Their overhead can reach as high as 90% of every dollar collected. So it makes sense that some private foundations are suspect, giving us all a bad name. Because of it, many reputable organizations won't deal with them.

I immediately applied to the IRS for a change in status, and as you can see from the IRS documents, the Pearl Foundation is indeed regarded as a public foundation now. However, we are in effect "under probation" for another few years, subject to more stringent rules and investigations. We have zero problem with that; we're very proud that the Foundation's own expenses to date have never exceeded $2,500.00. As I keep stressing, anything over that is either donated, or paid for by me. If you look at our tax returns, you can see where the money goes at the end of each year - we pretty much donate everything in the bank account to the schools we're working with. We run a very clean, very tight ship!

After consultation with the Pearl Foundation's tax accountant, I decided to post our tax returns and IRS letters here. Our tax returns are public documents and available to anyone willing to do the legwork. However, Section B, which lists the names of actual donors, has been removed, because I don't feel it appropriate to post those names if they're linked to my own or the Pearl Foundation website.

I hope this explains why these things are suddenly here, and continues to assure our donors that we are, indeed, above-board and transparent in our dealings!

Janis Ian
March, 2016

 

Important Documents

IRS Public Charity Letter

IRS Public Charity Letter

IRS Public Charity Letter

2013 Tax Return

IRS Public Charity Letter

2014 Tax Return