Launch a Legacy of Tax-Efficient Giving with a Donor Advised Fund

Considering charitable giving on a larger scale? A Donor Advised Fund is your simplest, least expensive, and most tax-efficient option.

In brief, a Donor Advised Fund serves as your own tax-advantaged, donor-controlled philanthropic fund. The fund can be established easily through a broker-dealer, your financial advisor, or if you have a specific charity in mind, you may establish the fund directly with a 501(c)(3) tax-exempt charity, or charitable foundation. All it takes is an initial minimum contribution of $5,000 in assets.

After you contribute to the Donor Advised Fund (DAF), you are in control of where and how the assets are directed. Meanwhile, the capital in the fund can be invested for tax-free growth.

With the significant benefits of flexibility, ease of management, and tax efficiency, Donor Advised Funds are the fastest growing vehicle for family philanthropy.

Tax Efficient Philanthropy with Donor Advised Funds

  • Cash contributions to the fund are tax-deductible up to 60% of the donor’s annual adjusted gross income (AGI) for the year of the gift. Your gift continues to grow tax-free when invested within the fund.
  • Donations of publicly traded securities (owned for more than year) are tax-deductible up to 30% of your AGI for the year of the gift, and there is no capital gains tax on the appreciated portion of the assets. (As a result, it’s advantageous to donate highly appreciated assets.)

Advantages of Donor Advised Funds vs. Private Foundations

  • Managing a Private Foundation is expensive, requiring legal and accounting help for annual tax filings.
  • All record keeping for a Donor Advised Fund is managed and readily available through the custodian of the account.
  • DAFs offer the privacy of anonymous grants. Foundation grants are public.
  • The timing of DAF grants is flexible. Foundations require a 5% annual distribution.
  • DAFs are more tax efficient for donors. Foundations have lower personal tax deductibility levels.
  • Foundations incur an excise tax on investment income.

Additional Benefits and Features

  • Ease of use: donate to multiple IRS-qualified charities and receive one simple tax receipt at the end of each year.
  • Non-cash assets are usually acceptable as contributions: equities, mutual funds, real estate, private equity, privately held corporate stock, crypto assets, collectibles, etc.
  • Involve your children and other relatives to build a family tradition of giving back to the community, to causes the family believes in.
  • Title the fund in your family or any other name.
  • If you wish, your financial advisor can manage the investments.

We welcome the opportunity to provide expert knowledge and execution of your philanthropic vision. The goal of our advisors is to become the equivalent of an extended family member who understands your values and seamlessly facilitates the realization of your family’s charitable goals. Feel free to use our team as a resource for information.


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