Donor Advised Funds
What is a Donor Advised Fund?
A donor advised fund (DAF) is a charitable giving program that allows you to combine the most favorable tax benefits with the flexibility to support your favorite causes. An increasingly popular charitable vehicle, DAFs are an excellent way to both simplify your charitable giving and facilitate your strategic philanthropic goals.
How does it work?
- Establish your DAF by making an irrevocable, tax deductible donation to a public charity that sponsors a DAF program.
- Advise the investment allocation of the donated assets (any investment growth is tax free).
- Recommend grants to the charities you support, with the option of being recognized or remaining anonymous.
What are the main advantages of a donor-advised fund?
- Simplicity — The DAF sponsor handles all record-keeping, disbursements, and tax receipts.
- Flexibility — Timing of your tax deduction can be separate from your charitable decision making.
- Tax-efficiency — Contributions are tax-deductible and any investment growth in the DAF is tax-free. It is also easy to donate long term appreciated securities, eliminating capital gains taxes and allowing you to support multiple charities from one block of stock.
- Family legacy — A DAF is a powerful way to build or continue a tradition of family philanthropy.
If you have any questions about Donor Advised Funds, please contact:
Cathy Black, Senior Philanthropic Officer
The Home for Little Wanderers
10 Guest Street
Boston, MA 02135