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Using Donor Advised Funds to Share the Giving and the Gift

Wednesday, 11 November 2015

by Brendan Bybee, JD MPA

As the holiday season hits high gear, you may find yourself reflecting on the year now passing, contemplating your expectations, goals, and hopes for the year, spoken and unspoken. As you do, you will declare some successes and perhaps some failures. Some of these will be financial, some personal, some relational. While your family relationships are among the most important considerations, financial matters can often take precedence because the effects are so tangible and immediate. It is important, therefore, to recognize opportunities to meet your most important needs while serving the most expedient.

As you anticipate the gifts you will be giving and receiving this season, your CPA may be very anxious to ensure you avoid leaving anything under the tree (menorah, etc.) for the Government. This may involve making last minute gifts to your favorite charities in order to maximize your tax deductions. This is a wonderful way to bless others while blessing yourself. What you may not have considered is that you can bless your family by including them in your giving.

Donor Advised Funds (DAFs) present a wonderful way to include your loved ones in your philanthropic activity. DAFs are established by you, as a donor, and held by an established 501(c)(3) non-profit organization. The donation is recognized immediately as a charitable gift for tax purposes, however, the funds can be held for later distribution as directed by you and your family.

DAFs can be established with only a few thousand dollars and can continue to receive additional donations over the years. DAF’s can also receive gifts from your will or trust upon your death. Depending on the institution holding the DAF you may even be able to appoint your own financial advisor to manage the investment of the fund and see your giving power grow. The opportunity to receive an immediate tax deduction while retaining the funds for later distribution presents myriad possibilities to work together with your family in blessing each other as you give to others.

The practice of philanthropy has a number of benefits particular to those who participate in the giving, such as increased feelings of gratitude, greater health and happiness, and increased compassion for others. By sharing your giving with loved ones you share in these blessings and create new occasions for family connection, meeting your most important goals while satisfying your most expedient concerns.

If you are interested in establishing a habit of giving within your family, come talk to us at Spaulding Law. We can help you make philanthropy a part of your plan and put you in touch with people and organizations that can help you give in ways that bless your family as well as the wider world around them.

This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.

Driving Directions from I-15:
• Take the Pleasant Grove exit 275 from I-15
• Turn North onto Pleasant Grove Blvd
• Turn left onto W. Grove Pkwy
• Quickly turn left into the Synergy/Spaulding Law parking lot.