10 Benefits of Giving Through a Donor Advised Fund
A simple and flexible charitable giving vehicle
At the Waukesha County Community Foundation (WCCF) we have helped donors streamline their giving and maximize their impact with charitable giving funds since 1999. Donor advised funds (DAFs) are a go-to charitable vehicle since they provide a flexible, easy and tax-advantageous way to support the causes you care about.
Learn more about the benefits of establishing a donor advised fund (DAF) at the Waukesha County Community Foundation:
1. Simplify your taxes: Do you regularly give to multiple nonprofits?
Whether it’s your alma mater, a house of worship, or other favorite cause—you may benefit from streamlining your giving through a donor advised fund. A DAF enables you to make one gift into the fund for a single charitable receipt come tax time – no more boxes full of receipts. You’ll receive an immediate tax benefit at the time of your contribution(s), and you won’t need to decide on how the funds are disbursed right away. The flexibility of a DAF allows you to recommend grants to any 501(c)(3) nonprofit on your own personal timetable.
2. Grow your charitable impact
The charitable dollars in your DAF are invested and over time provide a growing impact in perpetuity.
With steady market growth, your DAF balance can grow, making even more money available for grantmaking. And your fund’s investment growth is completely tax-free.
3. Donate complex assets
Contribute to your fund with a broad range of assets including cash, publicly traded securities, mutual funds, real estate, and even business interests. Some nonprofits may not have the capacity to accept these complex gifts, but they’ll have no trouble accepting a grant from your fund. As an additional bonus, contributions of appreciated assets to your DAF do not incur capital gains tax.
4. Access our convenient portal
By centralizing your charitable giving, you can manage all of your giving from one convenient fund. Our WCCF fund advisors have access to an online fund management portal that enables you to recommend grants to your favorite nonprofits, access fund statements, and review gift and grant histories at any time.
5. Engage others in philanthropy
DAFs are a great tool for those who want to involve others in their charitable giving. Name your children or grandchildren as successor fund advisors and they’ll be able to carry on your philanthropic legacy.
6. Utilize tax strategies
The simplicity and flexibility of a DAF means they work well as part of your overall tax strategy1.
“Bunching” is a popular strategy in which the donor concentrates several years’ worth of charitable contributions into one-year, gaining the maximum tax benefits while suggesting grants gradually over time. This technique has been increasingly attractive since the Tax Cuts and Jobs Act (TCJA) nearly doubled the standard deduction back in 2017.
7. Reduce administrative burden
Compared to other charitable vehicles, such as private foundations, a DAF is simple to operate and typically carries fewer expenses. While a private foundation might require you to participate in board meetings, meet a minimum distribution and file tax returns, with a DAF, the WCCF manages administration and investments on your behalf.
8. Maximize your community impact
The Waukesha County Community Foundation is here to assist donors by tailoring their giving strategy to create a meaningful impact. Our team can help you connect with the people, causes, and needs that align with your passions.
By partnering with the WCCF, you become part of a community of philanthropists that benefit from our services, events, and shared network of knowledge that is simply not available through commercial funds.
9. Low startup cost
At the WCCF, our pooled investments mean we are able to pass savings on to our donors, and there’s no fee to open a fund.
10. Easy to establish
Setting up a DAF at the Waukesha County Community Foundation is simple. Connect with our team or request a meeting with your financial advisor to get started.
Whether you’re just getting started in philanthropy or are looking to expand your giving, the Waukesha County Community Foundation is here to help at every stage of your charitable giving journey.
If you are interested in learning more about establishing a Donor Advised Fund at the WCCF or would like explore your charitable giving options, please contact us.
IMPORTANT LEGAL DISCLOSURE
- The information provided is general and educational in nature. It is not intended to be and should not be construed as legal or tax advice. The Waukesha County Community Foundation does not provide legal or tax advice. You should consult with your tax advisor to properly determine the tax consequences of making a charitable gift to the Waukesha County Community Foundation.
Contributions to the Waukesha County Community Foundation represent your irrevocable gifts subject to the legal and fiduciary control of the WCCF’s Board of Directors. ↩︎
