How do donor-advised funds work?
DAFs can be easily set up through your financial institution or a community foundation to serve as a flexible charitable giving vehicle. For more information on how to establish a DAF, contact your community foundation or financial advisor.
What is a donor-advised fund (DAF)?
You can think of a donor-advised fund (DAF) as a charitable savings account. There are two easy steps:
- You put money into the DAF. That transaction is tax-deductible and can give you a tax benefit.
- You advise the DAF to release those accumulated funds to the League or other charity. As the money in your DAF grows, don’t forget to “recommend grants” and put those funds to work for the League.
Why have a donor-advised fund?
There are many reasons, and they vary according to your financial situation. Please do consult your financial advisor to learn how you benefit.
- It allows you to put your financial investments to work to protect our democracy.
- You can eliminate capital gains on donated stock.
- DAF accounts have the potential to grow, possibly providing additional funding when you are ready to make a gift.
- You can event set up your DAF to make recurring gifts.
- You can pool your charitable giving to qualify for a tax deduction.
- Lastly, it costs you nothing to give from your DAF, so you can readily release funds at any time.