Breaking News: PSHF and LACA Funds

by Rosita Viduya Hueu

On January 14, 2011, the Lana’i Alumni and Community Association was informed that the Public Schools of Hawaii Foundation, in compliance with IRS regulation, will no longer handle Donor Advised Funds (Restricted Accounts).  In 1996, a year after LACA was formally established, President Robert Kinoshita, the late Kiyoshi Mana Minami, Awards Coordinator, and the board of directors, formulated a contribution plan with PSHF, a non profit organization.

With an initial deposit of $1,500 by Treasurer Randy Sanches an account was opened with the stipulation that all individual tax-deductible contributions would go into LACA’s Restricted Account with PSHF for the sole purpose of benefiting Lana’i High and Elementary School.  Instructions would come from LACA as to when and to whom funds for scholarships, awards and grants would be made. LACA itself is not a tax-deductible organization because the funds are not used exclusively for school support purposes.

Facing the IRS issue, and after much discussion on February 9,  the board of directors ratified the motion to have Lana’i High and Elementary School (LHES) be the depository for the balance in the PSHF fund. The transferred fund is to be utilized for educational needs by continuing the scholarship and awards program. Donations made to Lana’i High and Elementary School are tax-deductible.

A Donor Advised Fund is an account:

  1. which is separately identified by reference to contributions of a donor or donors,
  2. which is owned and controlled by a sponsoring organization and
  3. for which the donor (or any person appointed or designated by the donor) has or expects to have advisory privileges concerning the distribution or investment of the funds held in the Donor Advised Fund or account because of the donor’s status as a donor.

There are penalties which the IRS can impose on taxable distributions from such funds.

Contact any one of the board members if you have questions or comments to share:  Marge Asato, Coochie Cayan, Donna Ching, Monica Cockett, Suzanne Damian, Linda Degamo, Rosita Hueu, Sue Kincaid, Ruth Nakasone, Bruno Oroyan, Nickie Oshiro, Jean Piena, Bill Ruidas.

Leave a Reply

Your email address will not be published. Required fields are marked *