With a donor-advised fund, costs are minimal. Starting a donor-advised fund is free. You make your charitable donation to establish the fund, and the administrator charges a nominal annual fee, typically about 2%, to cover administration and investment fees – but only after you have received your full tax deduction for gifts to the fund.
Think of a donor-advised fund as a combined charitable savings and checking account that allows you to support the causes and charities that are important to you now, while also growing your charitable dollars for the future. Watch our video to learn more about donor-advised funds and how they can help you achieve your charitable goals.
An alternative to a private foundation, donor-advised funds offer a simplified, flexible and affordable approach to charity for those who are serious about their giving. You can name the fund for your family, business or a loved one.
Donor-advised funds streamline your giving through one charitable vehicle, while allowing you to continue giving to the causes you believe in – now or in the future, here or across the country.
You make the decisions, we handle the rest.
Benefits of a Donor-Advised Fund
Donor-advised funds relieve you of all the work. The administrator handles all the due diligence, record keeping, check writing, gift acceptance and tax filings.
Donations to donor-advised funds are deductible up to 60% of adjusted gross income on gifts of cash, and 30% on gifts of appreciated assets like stock, mutual funds and real estate. Deduction limits on gifts to private foundations are 30% and 20%, respectively. Donating long-term appreciated assets to a donor-advised fund may even eliminate capital gains taxes.
Donor-advised funds give you time to plan and be strategic about your charitable giving. Establish or donate to your fund when it makes the most tax sense, then distribute grants from the fund when the right charity or project comes along. In the meantime, your donor-advised fund’s assets will be invested, with earnings growing tax-free.
Support as many charities as you wish through your donor-advised fund. For tax purposes, you only need to track your contributions to the fund. Are multiple members of your business or family conducting charitable giving? By consolidating everyone’s charity in a donor-advised fund, you can minimize confusion and duplication.
While private foundation giving is public record, grants made through donor-advised funds can be made anonymously if you wish. You can also name your fund in such a way that fully protects you from funding appeals.
Donor-advised funds make a statement. You can name them for your family or company, or in honor of a co-worker or loved one. They are also an effective way to encourage philanthropy among your family or employees. You can involve your children, grandchildren and even future generations of family members in your grantmaking and name them as successor advisors. You can also endow your donor-advised fund so it will grow in perpetuity and later select a specific nonprofit or cause for your fund to permanently support upon your death.
Ways to Give
Akron Community Foundation can accept a variety of assets to establish your fund, and the best donation isn’t always cash.
Cash gifts may be deducted up to 60% of adjusted gross income for income tax purposes. Contributions over that limit can be carried over for up to five years. Gifts can be made via cash, check or credit card.
You’ll receive a double benefit if the stock has appreciated: an immediate charitable deduction for the fair market value of the securities donated and exemption from any capital gains tax on the appreciation.
By donating a portion of your privately held stock, you can receive a fair market value deduction for the contribution and avoid paying capital gains tax on illiquid assets that have greatly appreciated in value.
Many people find that the protection offered by life insurance is no longer needed later in life, making life insurance policies an ideal gift. If the policy is paid up, you will receive an immediate tax deduction for the policy’s cash surrender value.
Gifts of real estate can include a house, apartment building, farm, vacation home, commercial building or land. Once accepted, Akron Community Foundation has a separate LLC set up to handle these types of gifts for you.
Some donors may prefer to give their automobile, antiques or jewelry. Akron Community Foundation can accept these more complex gifts, too, but most will require an appraisal by an impartial party.
The Benefits of Working with Us
- We’re accessible online, by phone and in person
- We help you learn about local nonprofits
- Our administrative fees are low and stay in your community
- We’re happy to work with your advisor
- We’ll always be here, for you and future generations
- We offer many tax-smart ways to give