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There is a recent discussion of Private Foundations over on the Estate Planning board. You can probably find it by searching on the word Foundation. There is a link there to the board of the National Foundation association, which publishes books on the subject. Mostly what it takes to set one up and manage it.

Living trusts are usually used in states with high probate costs to control those costs. They can reduce those costs and keep your private affairs private, but in themselves they do nothing to reduce estate taxes. When appropriate, living trusts can be cost effective in estates down to about $80K.

Foundations usually must be established in a way that qualifies them as charities under IRS regulations. They can be complex to administor and keep the IRS happy. Books indicate that foundations to manage property donated for historical or wildlife preservation purposes can be cost effective down estates of about $200K, but most of them require assets of $10MM.

The foundation benefits you as a charity. By making contributions to it, you get tax deductions and can reduce the size of your estate for taxable purposes. So mostly, they can be part of your estate planning, but usually with very large estates.

Its a complex subject. If you are considering a foundation, do your homework, but make sure you get professional assistance. An estate attorney specializing in foundations will probably be needed.

I hope this brief intro points you in the right direction.
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