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The Foundation Center defines a foundation as a nongovernmental, nonprofit organization with its own funds (usually from a single source, either an individual, family, or corporation) and programs, managed by its own trustees and directors, and established to maintain or aid educational, social, charitable, religious, or other activities serving the common welfare, primarily by making grants to other nonprofit organizations.

Four types of foundations are included in Foundation Directory Online Basic, Plus, and Premium:

Independent foundation. A grantmaking organization usually classified by the IRS as a private foundation. Independent foundations may also be known as family foundations, general purpose foundations, special purpose foundations, or private non-operating foundations. The Foundation Center defines independent foundations and company-sponsored foundations separately; however, federal law normally classifies both as private, non-operating foundations subject to the same rules and requirements.

Company-sponsored foundation. A private foundation whose grant funds are derived primarily from the contributions of a for-profit business organization. The company-sponsored foundation might maintain close ties with the donor company, but it is an independent organization with its own endowment and is subject to the same rules and regulations as other private foundations.

Operating foundation. A 501(c)(3) organization classified by the IRS as a private foundation whose primary purpose is to operate research, social welfare, or other programs determined by its governing body or establishment charter. Some grants may be made, but the sum is generally small relative to the funds used for the foundation's own programs.

Community foundation. A 501(c)(3) organization that makes grants for charitable purposes in a specific community or region. Funds are usually derived from many donors and held in an endowment independently administered; income earned by the endowment is then used to make grants. Although a few community foundations might be classified by the IRS as private foundations, most are classified as public charities eligible for maximum income tax-deductible contributions from the general public.

Foundation Directory Online Platinum and Professional also include information on:

Grantmaking public charities. In general, an organization that is tax-exempt under code section 501(c)(3) and is classified by the IRS as a public charity and not a private foundation. Public charities generally derive their funding or support primarily from the general public in carrying out their social, educational, religious, or other charitable activities serving the common welfare. Some public charities engage in grantmaking activities, although most engage in direct service or other tax-exempt activities. Public charities are eligible for maximum income tax-deductible contributions from the public and are not subject to the same rules and restrictions as private foundations. Some are also referred to as "public foundations" or "publicly supported organizations" and might use the term "foundation" in their names. Only those public charities that engage in grantmaking are included.

Corporate giving programs. A grantmaking program established and administered within a for-profit business organization. Corporate giving programs do not have a separate endowment and their annual grant totals are generally more directly related to current profits. They are not subject to the same reporting requirements as private foundations. Some companies make charitable contributions through both a corporate giving program and a company-sponsored foundation.

The data in Foundation Directory Online is compiled from IRS information returns (Forms 990 and 990-PF), grantmaker web sites, annual reports, printed application guidelines, the philanthropic press, and various other sources. In all, the Foundation Center's editorial staff continually monitors more than 35 diverse information sources to verify the details in our databases. Our editorial team is also in frequent communication with grantmakers nationwide through telephone calls, surveys, and electronic reporting.

It is important to note that Foundation Directory Online is not designed for statistical or aggregate research and should not be used for these purposes. Please contact the Foundation Center for more information if you have these types of research needs.