Tuesday, March 26, 2013

12 Things To Do In 2013- Donor Advised Funds

12 Things to do in 2013- #3- Laurie Valentine

DONOR ADVISED FUNDS:
A TOOL FOR DEVELOPING FAMILY PHILANTHROPY

WHAT IS A DONOR ADVISED FUND (“DAF”)?

A Donor Advised Fund is a fund established with a public charity in which the donor retains for themselves, and possibly others, the right to make recommendations regarding the use of the gifts they make to the fund.  The donor’s retained right is only advisory; the charity is the owner of the DAF and has ultimate control over it.

WHY USE A DAF?

A DAF is a great charitable giving plan for people who want flexibility in timing philanthropic support.  A gift can be made to your DAF at a time when it may be most advantageous for tax-planning purposes without having to immediately decide what charitable causes/projects the gift will support.   It also provides the opportunity to be actively involved in “grant-making” from your DAF on an on-going basis.

WHEN ARE GIFTS TO A DAF DEDUCTIBLE?

Gifts to a DAF are deductible in the year they are made, whether or not there is any charitable distribution out of the DAF during that year.

HOW CAN A DAF HELP US DEVELOP “FAMILY PHILANTHROPY”?

On-going giving to particular charities (philanthropy1) is the result of the donor’s determination those charities are meeting needs in the community in ways that are making a difference.  Those decisions are impacted and shaped by the giver’s values and beliefs.

A DAF that includes children as donor advisors provides opportunities for sons and daughters to learn first-hand, as the family makes decisions about charitable distribution recommendations together, how their parents approach philanthropy, which organizations they value most and why, and what their parents expect from charitable organizations they support.

Through a DAF children learn by participating---they are not just being handed 2 quarters during the worship service to put in the offering plate; they are part of the process that explores what a $500 distribution from our family’s DAF to this particular organization will accomplish and how such a gift is in keeping with our family’s values and beliefs.

Donor Advised Funds can be a great way to grow giving children as the family gives together.


1 ”Philanthropy”:  The act of donating money, goods, time or effort to support a charitable cause, usually over an extended period of time and in regard to a defined objective (Wikipedia)


For more information, please call us at (502) 489-3533 or toll free in KY at 1-(866) 489-3533

The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.

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