Idaho Charitable Trusts and Private Foundations

Part of my Idaho Trusts Overview.

By Ronald W. Brilliant, Attorney at Law · Licensed in Idaho, Nevada & California · Last reviewed: September 2026 against the Idaho Code (Titles 15 and 68) as posted by the Idaho Legislature (July 1, 2026)

In This TopicIdaho TrustsTopic 8 of 14: Charitable Trusts

Chapter 12 of Idaho’s Title 68, titled “Private Foundations and Charitable Trusts,” adds certain terms to the governing documents of charitable trusts that are subject to federal private foundation rules (Idaho Code §§ 68-1201 to 68-1203). It also lets a trustee amend a charitable trust’s governing instrument in limited situations, with the prior consent of the Idaho attorney general (Idaho Code § 68-1204).

These rules matter to people who create or serve as trustees of private foundations and charitable trusts, and to the charities and individuals who benefit from them. The chapter is short, and most of its terms work by pointing to sections of the federal Internal Revenue Code.

Which Trusts Are Covered

Chapter 12 applies only to three kinds of trusts, each defined by reference to the Internal Revenue Code of 1986 (Idaho Code § 68-1201):

Kind of trust	Federal definition referred to
“Private foundations”	As defined in section 509 of the Internal Revenue Code (§ 68-1201)
“Charitable trusts”	As described in section 4947(a)(1) of the Internal Revenue Code (§ 68-1201)
“Split-interest trusts”	As described in section 4947(a)(2) of the Internal Revenue Code (§ 68-1201)

The amendment power discussed below reaches further. Despite the limits of § 68-1201, it also applies to all trusts described in section 501(c)(3) of the Internal Revenue Code (Idaho Code § 68-1204).

References in the chapter to the Internal Revenue Code of 1986 mean that term as it is now and later defined in Idaho Code § 63-3004 (Idaho Code § 68-1206). What those federal sections say, and how federal taxes apply, is governed by federal tax law and is not described here.

Terms Idaho Reads Into the Trust

Every trust covered by the chapter is treated as if its trust instrument contains provisions that prohibit the trustee from doing four things (Idaho Code § 68-1202):

1. Engaging in any act of “self-dealing,” as defined in section 4941(d) of the Internal Revenue Code, that would create liability for the tax imposed by section 4941(a) (§ 68-1202(a)).
2. Retaining any “excess business holdings,” as defined in section 4943(c), that would create liability for the tax imposed by section 4943(a) (§ 68-1202(b)).
3. Making any investments that would jeopardize carrying out any of the trust’s exempt purposes, within the meaning of section 4944, so as to create liability for the tax imposed by section 4944(a) (§ 68-1202(c)).
4. Making any “taxable expenditures,” as defined in section 4945(d), that would create liability for the tax imposed by section 4945(a) (§ 68-1202(d)).

These prohibitions do not apply to split-interest trusts, or to amounts in them, that are not subject to the private foundation prohibitions because of section 4947 of the Internal Revenue Code (§ 68-1202).

Required Distributions

Each covered trust, except a split-interest trust, is also treated as containing a provision that requires the trustee to distribute, for the purposes stated in the trust instrument, enough each taxable year to avoid liability for the tax imposed by section 4942(a) of the Internal Revenue Code (Idaho Code § 68-1203).

Because these terms are “deemed” to be in the trust instrument, they apply even if the document itself is silent (§§ 68-1202, 68-1203). The trust document can, however, turn them off, as explained below.

Opting Out of the Chapter

The chapter does not limit the power of the person who creates a trust, or a person who has retained or been granted the right to amend it, to include a specific provision saying that some or all of the chapter does not apply to that trust (Idaho Code § 68-1207). That provision may be in the original trust instrument or in an amendment (§ 68-1207).

When a Trustee May Amend the Governing Instrument

With the prior consent of the attorney general, a trustee may amend the terms of the governing instrument to the extent necessary for any of these purposes (Idaho Code § 68-1204):

• To make the instrument conform to the requirements for exemption from the taxes imposed in sections 4941 to 4945 of the Internal Revenue Code, including amendments that broaden, extend, reduce, or limit the trust’s charitable purposes (§ 68-1204(a)).
• To terminate the trust’s status as a private foundation in a manner described in section 507(b)(1) of the Internal Revenue Code (§ 68-1204(b)).
• To terminate the trust and transfer its assets to one or more section 501(c)(3) entities, because continuing is impractical due to the trust’s small size or due to changed circumstances that adversely affect its purpose or purposes (§ 68-1204(c)).

Who Must Consent

Before consenting, the attorney general must determine that the proposed amendments are necessary or appropriate to achieve the trust’s charitable purposes (Idaho Code § 68-1204).

The trustee may also need other consents before amending. If the trust is for the exclusive benefit of one or more charitable organizations, or if there are one or more residual beneficiaries, the trustee must also get the prior consent of those organizations or individuals (§ 68-1204).

Situation	Prior consent required from
Any amendment under § 68-1204	The attorney general (§ 68-1204)
Trust is for the exclusive benefit of one or more charitable organizations	Those organizations, in addition to the attorney general (§ 68-1204)
Trust has one or more residual beneficiaries	Those individuals, in addition to the attorney general (§ 68-1204)

The Courts and the Attorney General Keep Their Powers

Nothing in Chapter 12 impairs the rights and powers of Idaho’s courts or attorney general with respect to any trust (Idaho Code § 68-1205). Court proceedings involving trusts are covered on the trust and estate disputes page.

How Chapter 12 Fits With Other Idaho Trust Rules

• Purpose trusts: Idaho’s purpose trust statute says a trust may be created for any purpose, charitable or noncharitable, but also states that charitable trusts are not governed by that section (Idaho Code § 15-7-601(1), (8)). See trust protectors, purpose trusts, and dry trusts.
• Principal and income: A trustee’s power to adjust between principal and income may not be used on an amount permanently set aside for charitable purposes, unless both income and principal are set aside (Idaho Code § 68-10-104(c)(4)). See principal and income.

How I Can Help

I help people who create or serve as trustees of Idaho private foundations and charitable trusts understand how Chapter 12 affects their trust documents, whether an opt-out provision makes sense, and what consents an amendment under § 68-1204 requires. Request a consultation to discuss your situation.

This page provides general information about Idaho trust law, based on the Idaho Code, and is not legal advice. Court rules and case law also affect these matters. Every situation is different; consult an attorney about yours. Reading this page does not create an attorney-client relationship.