What is a Private Foundation or Private Family Foundation, and why do so many families seem to have them? This video explores those questions by considering the advantages of Private Foundations, along with some of their downsides as well as the basics to establishing a Private Foundation. Private Foundations are a type of 501(c)(3) non-profit organization funded by an individual, family, or business. Family Foundation is a term used to indicate a Private Foundation established by a family as a potentially perpetual charitable legacy. Together, Private Foundations hold over $800 billion in U.S. assets and distribute billions to charities throughout the world every year. Private Foundations offer significant IRS-approved tax benefits. Contributions to Private Foundations are tax deductible, although the deductions are limited to a percentage of the donors' Adjusted Gross Income or AGI. Donors can give appreciated assets, thereby avoiding capital gains taxes. Assets within Private Foundations grow income-tax free, although they are subject to an excise tax. Donors can structure Private Foundations so they maintain considerable control over the Foundation's investments, direction, and charitable distributions. Donors can also provide that their family members will serve on the board of directors for Private Foundations. Donors and their family members can also work for their Private Foundations, as long as their salaries are reasonable and their services are reasonable and necessary to the Foundation. Private Foundations have some downsides. Despite their name, Private Foundations are not private. For those concerned mainly with tax deductions, higher deductions are available by giving to Public Charities or Donor Advised Funds. Finally, the administrative costs for establishing and maintaining a Private Foundation can be considerable. Nonetheless, the investment is worthwhile for those who have the means and the desire to establish a lasting legacy of charitable giving.