Profile picture
Rob Tannenbaum @tannenbaumr
, 37 tweets, 7 min read Read on Twitter
Most people don't know anything about private foundations, so based on my ten years of experience on a foundation board, I want to explain a few things that are relevant to the NY Attorney General lawsuit against Donald Trump's "foundation."

If you start a foundation with your own money, that money is tax-exempt, in perpetuity. If you raise funds for your foundation, that money is also tax-exempt, for both the donor & the recipient.
The government allows this money to be tax exempt because it's being used to fund charities, which is good for society. This is the legal system's underlying premise: you don't have to pax tax on this money bc you're establishing a system by which the money will go to charity.
By law, a foundation must give away, in any tax year, no less than five percent of its average monthly capital in the previous year. Most foundations, like mine, stick to the minimum distribution, so they can grow the principal over time.
We give money, you won't be surprised to hear, to liberal charities, including the ACLU & Planned Parenthood, which have legal 501(c)3 designations. These donations support progressive organizations, but don't support progressive politicians, who by definition can't be 501(c)3.
By law, board members are allowed to pay themselves reasonable compensation, which I do. On a per-hour basis, it's not lucrative. You don't do it for the money, you do it to be charitable.
That compensation is the only benefit you're allowed to take. Anything beyond that can fall into the category of "self-dealing," which means you benefited personally from your donation. Here's an example: the NYC music venue The Kitchen is a 501(c)3. I can give them money.
But I can't take anything in return for my money! If I sent them a check and they said, "OMG, you're so generous, here are five tickets to see Rhys Chatham play next week," I couldn't accept those tickets. That would be self-dealing, and hence, illegal.
Not a difficult notion to understand, right? I've got a B.A. in English, with no business experience, yet I, a mere freelance writer, am able to understand the laws against self-dealing. They were explained to me not by a tax lawyer, but by a CPA.
(Nothing against CPAs. My dad was a CPA. His dad was a CPA. My brother is a CPA. I dropped out of AP Calculus after four weeks.)
Every foundation files an annual 990 return, akin to a tax return. You can find & read them on the IRS website. Almost two years ago, when I began looking at the Trump "foundation"'s 990s, I was surprised to see that Trump and his board members don't pay themselves compensation.
Trumps don't work for free. As I read the 990s, I understood why there was no compensation. First, board members seemed to have done no work (number of work hours must be specified on the 1099), and if they didn't work, then even a small amount of compensation isn't "reasonable."
Second, the Trump "foundation" was not spending its capital at a prudent rate--none of this cautious, foundation-building five percent for them! They were giving it out like drunken sailors. And largely bc they were using the "foundation" to benefit themselves & their cronies.
I laid out parts of how they benefited in Sept 2016. If you care, find the thread; to repeat it, I'd have to re-read the 990s, which I'm not gonna do, and the NY AG has found waaaaay more incriminating details than were apparent to me at the time.
What was clear to me, even in cursory looks at the 990s, was that the Trumps were gaming the system. They received donations from people who wanted favors, and distributed it to people from whom they wanted favors. It had little to do with "charity."
Most foundations have a focus: the arts, or medical research, or an alma mater. The Trump "foundation"'s only focus was the Trumps and their buddies. It was the charity equivalent of money laundering. What seemed clear to me was that the Trumps were stealing money from charity.
And as I warned in 2016, "A man who steals from charity would steal from anyone."
I've seen Trump defenders say, "But the foundation had no expenses! No compensation for the board! No legal fees!" LOL. Trump didn't talk to a lawyer because he knew he was breaking the law, and even a half-wit lawyer would've told him to stop, or face consequences.
"Maybe Trump didn't know." LOLOL. If I, without any business savvy, knew the law--and "no self-dealing" was literally the first thing I learned--then he did. His apologists want to depict him as a business GENIUS, except for when it's convenient to say he may have been naive.
The Trump "foundation," at one point, had $1.3 million, which is embarrassing for a billionaire. It's about the same size as the foundation where I'm on the board. We pay our president $10,000 a year. Do you get it? Trump was turning down a paltry amount of money. And...
it didn't matter to him, because the "foundation" was paying dividends way in excess of $10,000. He's a carny, and running a foundation was just another midway game for him. Just another way to steer money into the First National Bank of Donald Fucking Trump.
This is a man who's lifelong credo has been "What's in it for me?" If you think he gave away money just because it was the Christian thing to do, I've got a few Shrouds of Turin I'd like to sell you.
By the way, IIRC, a 990 must be signed by the foundation president & also the foundation's CPA. And LOLOLOL at the half-blind, compromised, poor-shmuck CPA who signed the Trump "foundation"'s 990. Can a legit CPA tell me: Does the Trump "foundation"'s CPA face legal consequences?
Summing up: Trump Foundation is an oxymoron. As with every breathing moment of his life, he saw it as an opportunity to make more money for himself, his family, and his pals. Both morally and legally, foundation and charity have specific meanings, both of which Trump violated.
He stole money from the collection plate--if there's a $1.3 million collection plate--because in his whole life, he's never faced any consequences for his brazen greed. But I think the NY AG might put an end to that streak. /end
Came back to say, Oh fuck, *whose lifelong credo. That will bother me all night.
A reply to the boring "Now do the Clinton Foundation" tweets: Anyone who equates the Trump "Foundation" and the Clinton Foundation either a) doesn't understand foundations or b) has an anti-Clinton agenda, thus efforts to explain TF vs. CF would be useless, also I'm not your mom.
If you've enjoyed this thread, please go listen to someone's SoundCloud, I don't care whose.
Re: the “Trump didn’t know what his foundation was doing” chumps, during his pres campaign, he literally cited and denounced the law he was breaking. (See footnote.) Also, he’d like to repeal Constitutional separation of church and state.
This thread continues to get a lot of views, so I want to exploit that--no, not to send you to my SoundCloud (I actually do have one...), but to explain why you, yes YOU, should start a charitable foundation.
Caveat: very few people, I know, have at hand the kind of savings I'm going to discuss. It's unrealistic for all but a few readers. But I want people to understand that a foundation isn't just for Rockefellers.
Let's say you give $500 a year to @PPFA, starting this year. (You should.) By 2038, you'll have given them $10K. And that's fantastic! But, if you had it, you could take $10K, start a foundation, and get even more value out of that money.
With an establishing principal of $10K, you'd be required to give away roughly five percent a year--$500. Maybe you make @PPFA the only charity to whom you donate. After 20 years, you'd have given them $10K, AND your foundation would still have $10K in it.
I made that math simplistic, maybe even deceiving, just so the numbers line up. In fact, after 20 years, you would NOT have $10K in your foundation. If the economy grows at a normal rate, and your investments are diversified, you'd have more like $12K in your foundation.
You're giving away five percent a year. So as long as your investments grow at more than a five percent rate, your foundation will grow. Mine has. And with $12K, you could now give $600 a year to @PPFA.
Plus, let me tell you, giving away money to charities feels FANTASTIC. Sadly, Donald Trump doesn't understand this.
Missing some Tweet in this thread?
You can try to force a refresh.

Like this thread? Get email updates or save it to PDF!

Subscribe to Rob Tannenbaum
Profile picture

Get real-time email alerts when new unrolls are available from this author!

This content may be removed anytime!

Twitter may remove this content at anytime, convert it as a PDF, save and print for later use!

Try unrolling a thread yourself!

how to unroll video

1) Follow Thread Reader App on Twitter so you can easily mention us!

2) Go to a Twitter thread (series of Tweets by the same owner) and mention us with a keyword "unroll" @threadreaderapp unroll

You can practice here first or read more on our help page!

Did Thread Reader help you today?

Support us! We are indie developers!

This site is made by just three indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member and get exclusive features!

Premium member ($3.00/month or $30.00/year)

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!