Endowment Fund

An alternate form of organization for smaller assets is the establishment of an endowment fund under the management of a trustee. This allows you to permanently support a specific charitable cause. The founder generally specifies the establishment of the endowment fund in a trust deed and transfers the assets to the trustee (for example, the University of Mannheim Foundation), who manages them separately from his/her other assets as a fund for special purposes. All earnings from this fund then go to the endowment fund under the name designated by the founder. The endowment fund is not a taxable entity and therefore not able to issue tax-effective donation receipts. This can only be done by the trustee as a tax-exempt non-profit entity. It can be an alternative to the establishment of a foundation. You still have the opportunity to put your name to the endowment fund and secure it in perpetuity. If this is an option for you, feel free to talk to us.