Donor-advised funds are an often-underutilized tool offering tremendous advantages to those wishing to contribute to the betterment of society. As an alternative to the painstaking process of properly setting up and maintaining a charitable foundation, a benefactor can contribute to a donor-advised fund to retain some oversight over the administration of their gift, while capitalizing on favorable tax and estate planning incentives. Gifts to a donor-advised fund are irrevocable with the grantor maintaining an advisory function such as the recommendation of grants and identifying worthy causes.
Some key points on donor-advised funds:
- Donations can be cash, stocks, real estate, or other allowable assets
- Donations are tax-deductible with the deductible amount based on factors including type of asset and length of ownership
- Donations can be conveniently structured as single, recurring, or future gifts, with new contributions reflected in the fund’s overall balance
The Directed Benefits Foundation specializes in tailoring creatively designed donor-advised funds that adhere complex regulations while still satisfying the estate planning and tax concerns of our remarkable donors.