The answer is yes and here’s why!
It’s no secret that donor-advised funds (DAF) are a unique philanthropic tool and are the fastest growing charitable giving vehicles in the nation. DAF’s allow your clients to establish a charitable fund at an institution, such as a community foundation, and remain involved in supporting the causes and issues they care about by providing recommendations about grant distributions from the DAF.
Fund holders may also involve family members or other individuals designated by them to serve as advisors to the fund, while the community foundation oversees the management and distribution of the funds.
Why are DAFs Important?
DAFs offer a greater level of flexibility in grant-making than other giving vehicles—which is crucial in responding to unanticipated community needs. For example, if there is a wildfire, hurricane, water contamination, or other evolving needs, a community foundation in consultation with a donor advisor has the ability to respond quickly and make a grant to address that need. Simply put, DAFs bring solutions to the causes and issues that matter most.
Do DAFs Provide A Special “Tax Break” to Wealthy Donors?
No. There is no “special deduction” for DAFs. Sponsoring organizations must be public charities, and donors making a gift to a DAF receive the same charitable deduction available to other taxpayers who make charitable donations to a public charity. Once donated, the funds become property of the sponsoring organization and the donor can never reclaim them in his or her individual capacity.
Are DAFs just another benefit for the super wealthy?
No. Because of the relatively small amount needed to start a DAF compared to assets needed to create a private foundation, DAFs serve as an opportunity for all Americans to pursue their philanthropy and to gain the benefit of the community foundations’ expertise and experience in helping to guide their giving.
Are DAF’s Helping our Community?
Absolutely! Community Foundation for Palm Beach and Martin Counties has always taken seriously the obligation to serve our communities.
We participate voluntarily in the National Standards for U.S. Community Foundations™ program. In addition to a rigorous review of all aspects of our operations, this peer-driven best practices process includes a review of our DAF policies and procedures to ensure we exercise our administrative duties over all funds, gifts and grants with donor input. Overall, our DAFs build stronger communities, encourage civic engagement, and empower donors to respond immediately to local needs.
If you would like to learn more, please contact Sheila Kinman at firstname.lastname@example.org or call 561.340.4503.