What is a donor-advised fund?

A donor-advised fund (DAF) provides donors with a centralized charitable giving vehicle. It allows philanthropically inclined individuals, families, and corporations to make an irrevocable charitable gift to a public charity that sponsors a DAF program and take an immediate tax deduction. Most sponsoring organizations of DAFs accept cash equivalents, securities, and certain other assets.

How does it work?

• Establish your DAF by making an irrevocable, tax-deductible donation to a public charity that sponsors a DAF program.
• Advise the investment allocation of the donated assets (any investment growth is tax-free).
• Recommend grants to qualified public charities of your choice.

Main advantages of a donor-advised fund

• Simplicity—The DAF sponsor handles all recordkeeping, disbursements, and tax receipts.
• Flexibility—Timing of your tax deduction can be separate from your charitable decision making.
• Tax efficiency—Contributions are tax-deductible, and any investment growth in the DAF is tax-free. It is also easy to donate long-term appreciated securities, eliminating capital gains taxes and allowing you to support several charities from one block of stock.
• Family legacy—A DAF is a powerful way to build or continue a tradition of family philanthropy.
• No start-up costs—There is no cost to establish a donor-advised fund. However, there are often minimum initial charitable contributions to establish the DAF (typically $5,000 or more).*
• No transaction fees—Once approved, 100% of your recommended grant goes to your qualified public charity of choice.*
• Privacy if desired—Donors may choose to remain anonymous to the grant recipient.

* Sponsoring organizations generally assess an administrative fee on the assets in a DAF. These fees vary by the charity that sponsors a DAF program.

For more information, please contact our Planned & Major Gifts Office at (866) 662-9900, or email to [email protected]