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Donor Advised Funds (DAF)

 

What is it?

A DAF is a flexible, tax efficient charitable giving account to which you, your family and even friends can contribute. The money is invested and grows over time. You can make distributions to charities of your choice. With a minimum gift of $5,000 to the St Paul Jewish Federation you can establish a DAF. 

How Does It Work?

With a minimum gift of $5,000 to the St. Paul Jewish Federation, you can establish a donor-advised fund. You are entitled to an immediate income tax deduction in the year in which you create the fund and for later contributions to the fund.

You simply recommend distributions to any qualified public charities in the Jewish or general community. You are entitled to appoint successor advisors to make recommendations for distributions from the fund.

As an alternative to a private foundation, your donor-advised fund can include:

  • check writing
  • professional investment services
  • fiduciary services to ensure compliance with your charitable intent

What are the Advantages?

  • You can make contributions or recommend distributions from your fund at any time with no annual distribution requirement.
  • You receive an immediate charitable income tax deduction for gifts to the fund.
  • A fund created after the end of a good business year or from an unexpected windfall allows you to bank those surplus funds and spread gifts to your recommended charities over a period of years.
  • You avoid capital gains tax on contributions of appreciated assets.
  • Income and growth within the fund are tax-free.
  • In contrast to a private foundation, the fund does not have to file tax returns or pay an excise tax on investment income.

For more information, contact David Kaplan at dkaplan@stpaulfed.org.