Giving From Your Donor-Advised Fund: The Details
Is a Donor-Advised Fund Right for You?
- Claim the tax deduction now and decide where to give later
- Donate appreciated assets (stock, crypto, real estate) without incurring capital-gains tax
- Keep all your charitable gifts and receipts in one place
- Involve children or grandchildren and build a family giving tradition
- Enjoy the flexibility of a private foundation minus the cost and paperwork
Think of a Donor-Advised Fund (DAF) as your personal charitable giving account. It's a smart, flexible way to support the causes you care about while maximizing your tax benefits. You contribute to your DAF when it makes the most sense for you, then recommend grants to your favorite charities whenever you're ready—whether that's today, next year, or even after your lifetime.
Learn more about DAFs in our FAQ
Smart Giving, Significant Benefits
A DAF offers you the best of both worlds: immediate tax advantages and the flexibility to support charities on your timeline. Here's what makes DAFs so powerful:
Tax Benefits That Work for You
- Immediate deduction: Claim your tax deduction when you contribute to your DAF, not when you make grants.
- Higher deduction limits: Deduct up to 60% of AGI for cash gifts and 30% for appreciated securities held more than one year (these limits have been made permanent under the 2025 tax law).
- No capital gains tax: Donate appreciated stocks, mutual funds, or even cryptocurrency directly and avoid capital gains taxes entirely.
- Estate planning advantages: Include your DAF in your will or estate plan to create a lasting legacy.
Important 2026 Changes: Starting in tax year 2026, new rules will affect charitable deductions:
- A 0.5% AGI “floor” means you'll only deduct charitable contributions that exceed 0.5% of your adjusted gross income
- If you're in the top tax bracket (37%), your deduction will be capped at $0.35 per dollar donated
- Non-itemizers can claim up to $1,000 ($2,000 for joint filers) in charitable deductions
Planning Tip: Consider accelerating larger charitable contributions into 2025 to maximize your deductions before the new rules take effect.
Complete Control and Flexibility
Your DAF puts you in the driver's seat. You decide:
- Which charities to support and when
- How to invest your funds for potential growth
- Whether to make anonymous grants
- Who continues your legacy (name successors or create a permanent endowment)
Streamlined Giving That Makes a Difference
Managing your charitable giving has never been easier. With a DAF, you can:
- Simplify your giving: One tax receipt for all your contributions, regardless of how many charities you support
- Research with confidence: Most DAF sponsors verify that organizations are IRS-qualified charities
- Give strategically: Time your contributions for maximum tax benefit (like donating appreciated assets in high-income years)
- Support any cause: From local food banks to international relief efforts, you choose where your dollars go
Many donors find DAFs especially valuable when:
- They receive a windfall (stock options, business sale, inheritance)
- They want to involve family in charitable decisions
- They're planning their estate and want to include charitable bequests
- They hold appreciated securities or cryptocurrency they'd like to donate
- They want to maximize deductions before the 2026 tax changes (consider “bunching” multiple years of charitable giving into 2025)
Creating Your Lasting Legacy
A DAF can be a cornerstone of your philanthropic legacy. You can:
- Name your DAF to honor loved ones or reflect your values
- Appoint successors to continue your charitable vision
- Create grant recommendations that support causes important to you
- Establish a permanent charitable fund that gives forever
When you include your DAF in your will, you ensure your values live on while potentially reducing estate taxes for your heirs. Don't have a will? Do not let the government decide your legacy.
Create a free will online by following this link.
Getting Started Is Easy
Opening a DAF takes just minutes online with most sponsors. You can start with as little as $5,000 at many institutions, and even less at some. Once established, you can contribute cash, stocks, cryptocurrency, or other assets whenever it makes sense for your financial situation.
Ready to amplify your impact? Contact us to learn how a donor-advised fund can transform your charitable giving while maximizing your tax benefits.