14:45 What is the tax benefit of a Foundation vs. a Nonprofit organization?

Welcome back to another installment of Tax Tuesday! There are a lot of questions to cover in this episode so tune in as Toby Mathis, Esq. and Jeff Webb, CPA, break them down.

0:00 Intro

10:45 I think most people have heard of 1031 Exchanges and the associated tax deferral benefits but I recently became aware of Section 721 Exchanges. Can you discuss the similarities and differences between these two options?

14:45 What is the tax benefit of a Foundation vs. a Nonprofit organization?

20:31 I have two houses I’m selling this year at the same time. Question, will I have a problem claiming both of them as residents for two out of the last five years since I’m selling them at the same time?

26:43 I am planning to follow your renting-out-stocks advice in selling covered call options. The earning of that deal will be used to buy more stock from the same company. How is the tax situation here?

32:07 How are stock options taxed?

37:24 I have an LLC taxed as an S-Corp with a brokerage account. Can the profit/loss from active stock trading business be reported as business income/loss or capital gain/loss?

43:51 We have a (second home) property that we are renting as an STR, it is titled under a WST, and we are already paying property taxes. Does a 571 L form/business property tax still apply to us?

45:42 Who can qualify for an HSA? I am an active-duty military member and have been told I don’t qualify. However, my wife still has copays based on her plan and I will have to pay copays once I retire.

51:06 I have an HSA with my W-2 job that I am maxing out. Can I open an additional HSA with my LLC business?

56:22 Anderson Advisors helped me structure and create my C-Corp. How do I legally and tax-friendly take the $7,000 back that I need for my personal reimbursement?

1:00:45 Outro
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Toby Mathis, Esq. is the best-selling author of Infinity Investing: How the Rich Get Richer And How You Can Do The Same. Toby is a tax attorney and founded Anderson Business Advisors, one of the most successful law, tax, and estate planning companies in the United States. Learn more at
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When it comes to charitable giving, there are two main options for individuals and corporations: nonprofits and foundations. While both offer tax benefits, it’s important to understand the differences and which one may offer the best tax benefits.

Nonprofits are organizations that exist to serve a specific charitable purpose. They are recognized by the IRS as tax-exempt under section 501(c)(3) of the Internal Revenue Code. Nonprofits are typically funded through donations and grants, and the funds are used to support the charitable purpose.

Foundations, on the other hand, are typically established by individuals or corporations and are funded with a large donation or endowment. The foundation’s funds are then used to support charitable causes, but they do so by making grants to other nonprofits.

So, which one offers the best tax benefits? In terms of tax deductions, both nonprofits and foundations offer the same benefits. Donations made to either are tax deductible up to the limits established by the IRS. For individuals, this is typically up to 60% of their adjusted gross income. For corporations, the limit is typically up to 10% of their taxable income.

However, there are some differences in tax reporting and regulations between nonprofits and foundations. Nonprofits are required to file an annual Form 990 with the IRS, which is a comprehensive report of their financial activities. This report is available to the public and can be used to evaluate the nonprofit’s financial health and transparency.

Foundations, on the other hand, are required to distribute a certain percentage of their assets each year in the form of grants to other nonprofits. Failure to meet this distribution requirement can result in penalties and loss of tax-exempt status.

One potential advantage of having a foundation is the ability to have more control over the direction and focus of your charitable giving. With a nonprofit, donors can make donations to support a particular cause or program, but ultimately the nonprofit’s leadership determines how those funds are used.

In conclusion, both nonprofits and foundations offer tax benefits for charitable giving, and the choice may come down to personal preference and desired level of control over charitable giving. It’s important to consult with a tax professional or financial advisor to determine which option may be best for your individual tax situation.