COMMUNITY
W H AT ' S H A P P E N I N G I N N O R T H E A S T F LO R I DA
UNLOCK GREATER GIVING WITH A DONOR ADVISED FUND By Kellie Smith, Jewish Federation & Foundation of Northeast Florida
How does a donor-advised fund work?
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Reducing your capital gains and estate taxes
Giving through a donor-advised fund rather than contributing directly to charity has become more popular than ever, with the number of individual DAF accounts reaching one million in 2020 according to the National Philanthropic Trust. One presumable reason for the recent rise in DAFs is the 2017 federal income tax law change which substantially increased the standard deduction. With this change, the donor-advised fund makes even more sense. Typically, one would take the standard deduction when itemizing deductions (including charitable donations) would amount to less; however, with a donoradvised fund, you have the tax advantage of being able to “bundle” multiple years' worth of donations in one year and then choose to allocate those funds over multiple years.
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Designating successors to perpetuate your legacy
A donor-advised fund, or DAF, is a charitable investment account where you can deposit cash, securities, and other assets. These accounts come with a multitude of advantages and allow donors to grow the amount of money they have to give away by investing their contributions, while simultaneously receiving immediate tax benefits from them.
What are the other benefits to giving from a donor-advised fund? •
Simplifying your recordkeeping
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Increasing your generosity
One of the most obvious perks of a DAF account is the ability to organize and streamline your giving through one source and consolidate all your donation records to one tax receipt at the end of the year. Eliminate writing separate checks and simply focus on the joy of giving!
By using a donor-advised fund, you'll avoid paying capital gains tax on the assets you allocate toward it, which may increase the amount available for charity by up to 20 percent. Plus, your deductions might increase—if you bought an asset for less than it's worth today, you can deduct its current market value instead of the original price. You can name your children, grandchildren, or others as successor advisors to your fund. Successor advisors have the privilege of managing your fund after your death and carrying on your charitable values and traditions. How do I get started?
Donor-advised funds are a flexible, efficient, donor-centric form of philanthropy and this opportunity isn’t just reserved for the wealthy. You can open a donor-advised fund with the Jewish Foundation with a tax-deductible minimum gift of $2,500 or $1,000 if you’re under 40. You may make additional contributions of any amount at any time, but no additional contributions are required after your fund has been established. Most importantly, by creating your DAF with the Jewish Foundation you are supporting the growth of our Jewish community through the small, shared fees that we derive from the management of your fund. Your partnership enables us to provide philanthropic education programs to help inform current donors about critical issues within the community and develop the next generation of givers. Opening a fund and creating a legacy within the Jewish Foundation helps to preserve a thriving Jewish Life in Northeast Florida for generations to come.
A DAF maximizes your giving power by utilizing a taxContact Kellie Smith, Foundation Director, at KellieK@ free, long-term investment strategy. Like any investment, jewishjacksonville.org or (904)512-3796 to open a donorthe money has the potential to grow while it sits in the advised fund and unlock greater giving today! This article is fund. You choose from a variety of investment options only intended to be a general overview of some donation according to your own risk tolerance and monitor your considerations and is not intended to provide tax or legal balance and activities online at any time. guidance. In addition, all gifts to donor-advised funds are 7 irrevocable. Please consult with your tax or legal advisor.
