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Donor Advised Fund (DAF)

What is a DAF?

A Donor Advised Fund (DAF) is a simple vehicle established by a donor to efficiently give gifts to nonprofits while minimizing tax impact.

Best for - Individuals, couples or families that want to:

  • Leverage the impact of their gifts by separating the timing of their tax-deductible activity from the timing of gifts to nonprofits;
  • Build or continue a legacy of community support;
  • Maximize employer charitable matching programs; and
  • Be more strategic with their philanthropic resources.

 

 

Which type of Fund is better for me?

⇒ DAF (Donor Advised Fund)


⇒ DAF-GAP
(Donor Advised Fund with Grant Application Process)

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DAF-GAP chart

How do I establish a DAF?

You will need to fill out the “Fund Agreement” which includes choosing a unique name for your Fund.  The Fund Agreement outlines the parameters of your Fund, and areas such as the following are addressed:

  1. Who are the primary advisors with the authority to make distributions from the Fund?
  2. Do you want the Fund to be invested and placed at market risk?
  3. What are the administrative costs for a DAF?

 

To review a copy of the Fund Agreement or for more information about a Donor Advised Fund, call or email Julie Johnson at (512) 863-4186 or juliejohnson@chisholm-trail.org.


While we share giving concepts, we do not provide legal, tax or financial advice.

how do I fund a daf?

You can always simply write a check to fund a DAF, but click the button for details to maximize your philanthropic dollars regarding the following:

  1. Gifts of appreciate securities;
  2. "Bunching" to maximize itemized deductions; and
  3. Leveraging an employer matching campaign.

What Are the Top 5 Benefits of a DAF?

1. TAX-Free Growth

If you choose to have your Fund invested at CTCF, any gains achieved by the Fund are tax-free growth that you can use to further support charitable organizations.   *Past returns are no guarantee of future performance.

2. Double your giving

A Donor Advised Fund (DAF) at CTCF qualifies as a recipient of an employer charitable matching program.  Check with your employer to determine if they have a charitable matching program and how much they match annually.

3. Gifts that keep on giving

In lieu of birthday, anniversary or holiday gifts, invite family and friends to donate to your Fund, and then experience the joy of giving to organizations that address the community needs most meaningful to you!

4. Avoid Capital Gains tax

If you have proceeds from a stock sale that you are planning to donate, be sure to consider gifting the stock directly to your Fund.  Instead of selling the stock, paying taxes and then being left with a smaller amount to donate, verify how long you have owned the stock.  When you gift the stock directly to your Fund, you may not have to pay capital gains tax if you have owned the stock longer than one year or ordinary tax if less than one year.

5. Separate Tax Planning from Charitable planning

Essentially, a DAF allows you to separate your TAX planning from your CHARITABLE planning.  When you make a donation to your DAF, you take the tax deduction immediately, but you do not have to make equivalent distributions from your Fund in that calendar year.  You can "bunch" or "bundle" your donations to maximize itemized deductions in year one, while planning to distribute the dollars to nonprofit organizations in subsequent years when you could take the standard deduction.

Momentum-agencyFund

How do I establish a DAF?

You will need to fill out the “Fund Agreement” which includes choosing a unique name for your Fund.  The Fund Agreement outlines the parameters of your Fund, and areas such as the following are addressed:

  1. Who are the primary advisors with the authority to make distributions from the Fund?
  2. Do you want the Fund to be invested and placed at market risk?
  3. What are the administrative costs for a DAF?

 

To review a copy of the Fund Agreement or for more information about a Donor Advised Fund, call or email Julie Johnson at (512) 863-4186 or juliejohnson@chisholm-trail.org.


While we share giving concepts, we do not provide legal, tax or financial advice.