In 1918, Milton Hershey Quietly Put About $60 Million In Stock Into A Trust. Over 100 Years Later, That Trust Still Exists And Holds About $23.6 Billion In Assets. Wealthy Donors Still Use A Similar Strategy, And The Legal Work To Set One Up Starts At A Few Thousand Dollars
A childless candy maker secretly handed his fortune to orphans in 1918, and the legal structure he chose still controls one of America's biggest snack companies today. Wealthy donors quietly use a version of the same playbook, but the fine…
In 1918, a childless candy maker quietly moved a large block of company stock into a trust for orphans. He told almost no one.
According to Philanthropy Roundtable, Milton Hershey placed about $60 million of Hershey (NYSE:HSY | HSY Price Prediction) stock into the trust in November 1918. For scale, Coca-Cola (NYSE:KO) sold for $25 million that same year. The foundation went back further. Hershey Trust Company was chartered on April 28, 1905, and in 1909 Milton and Catherine Hershey signed a deed of trust for what was then the Hershey Industrial School. Today it is the Milton Hershey School.
A Century-Old Trust Still Controls a Snack Giant
The Milton Hershey School and School Trust’s Form 990 for the fiscal year ending July 2025 shows total assets of about $23.6 billion and net assets of about $23.3 billion. That total covers far more than Hershey stock, and it changes from year to year. Total assets stood at $23.4 billion in July 2024 and $24.2 billion in July 2023.
The trust owns almost all of the Class B stock of Hershey. Bloomberg reported on December 11, 2024 that those shares carried roughly 80% of the company’s voting power. Hershey’s proxy calls the trust company, acting as trustee, the controlling shareholder. As of March 6, 2026, it held 54,612,012 Class B shares, and each one can be converted into a share of common stock. The trust turned away a takeover approach from Mondelez International (NASDAQ:MDLZ) in 2024 and blocked another in 2016.
He Made America’s Orphans His Heirs
Hershey said he had no heirs, so he decided to make the orphan boys of the United States his heirs. He kept the gift private until a 1923 New York Times interview, given at age 66. When he died in 1945, he owned little beyond his home and its furniture. The school serves low-income students. In 2021, ProPublica reported fiscal 2020 figures of about 2,100 students and roughly $90,000 in spending per student per year.
A trust like this does three things. It separates the assets from the donor, ties them to a stated purpose, and keeps them working across generations. The donor gives the assets away for good.
What Today’s Donors Use Instead
The closest modern comparison is a private foundation, though it is a different legal vehicle from Hershey’s 1909 deed of trust. The donor picks the board and the causes, and the foundation can fund international grants, scholarships and direct aid. A donor-advised fund offers less flexibility but allows anonymous gifts. Foundation giving is public.
Based on 2021 reporting, donors can deduct cash gifts to a private foundation up to 30% of adjusted gross income and publicly traded securities up to 20%, with a five-year carryover. Those limits may have changed since. Private foundations must also distribute at least 5% of their assets each year and pay a 1.39% excise tax on net investment income.
Setup Costs Run Well Past a Few Thousand Dollars
Wylie Advisory estimates that attorney-drafted formation documents cost $3,000 to $10,000. The “few thousand dollars” in the headline refers only to the low end of that drafting work. The IRS Form 1023 filing fee is $600. Crewe Foundation Services puts typical total startup costs at $5,000 to $20,000, while American Endowment Foundation says private attorneys often charge $7,500 to $25,000 for the state and federal filings. Wylie estimates annual operating costs of $5,000 to $30,000 or more, not counting investment management fees.
The firm also says many advisors want $3 million to $5 million in assets before recommending a foundation. All of these figures are advisory-firm estimates. A donor-advised fund is the cheaper route. Anyone considering either option should have an estate or tax attorney confirm current costs and limits.
Even Hershey’s Trust Gets Policed
In 1963, $50 million, about 20% of the endowment, was allocated to create the Milton S. Hershey Medical Center. Courts later blocked attempts to allocated more. In 2002, the trust voted to explore selling the company, and Pennsylvania’s attorney general won a court injunction.
After bids came in, the trustee voted 10 to 7 on September 17, 2002 to turn down them, according to Gadsden. The trust then agreed to notify the attorney general in advance and get court approval before any future sale. In 2016, state regulators sought the removal of several board members. The lesson for donors is that the governing document has to spell out retention, sale and oversight if the original intent is going to last.
Hershey had no heirs, so he chose some. Watch whether court and attorney general oversight keeps that intent intact.
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AJ spent 10 years writing about financial markets at The Motley Fool. His coverage centers on technology stocks and the broader macroeconomic trends, from interest rates to geopolitics, that shape where markets are headed next. AJ is drawn to the stories where big-picture economics and individual companies collide.
