Celebrities are embracing philanthropy by starting their own foundations, but those foundations vary wildly in how effectively they get money to charities, Forbes magazine reports.
The most efficient foundations tend to be those with the celebrity as the only donor.
The Stephen and Tabitha King Foundation, for example, gave out $4.4 million — with only $4,638 in overhead expenses in its latest available yearly reporting period.
Other efficient givers include Johnny Carson, Jay Leno, Tom Brokaw, Peter Jennings, Ray Charles, Gloria Estefan, Rosie O’Donnell and Wolfgang Puck — all of whose foundations have overhead costs of 2 percent or less of their total budgets.
Organizations that raise funds from outsiders spend more on fundraising, the magazine reports.
Yet the most efficient of these foundations still keep their overhead relatively low.
Paul Newman, Elton John and Elizabeth Taylor all have foundations whose overhead expenses are 16 percent or less of their annual budgets.
The least efficient foundations, Forbes says, include the Nicole Brown Simpson Foundation, which spent 96 percent of its budget on overhead, the Evander Holyfield Foundation at 86 percent, the Ned Beatty Hope for Children Classic at 77 percent and Magic Johnson’s foundation at 72 percent.
Sean “Puff Daddy” Combs receives a salary from his own foundation of $50,000 a year. He is unusual in that respect: Because of past media criticism, few celebrities put themselves or their relatives on foundation payrolls.
Federal tax laws place few regulations on overhead expenses.