Good News About Donor-Advised Funds

Three fundamental concepts are important to gaining a better understanding of how donor-advised funds work at the community foundation.

Many options are available at GPCF.

It’s important to note that a donor-advised fund is just one of many types of funds that an individual, family, or business can establish with GPCF. You’re likely more aware of donor-advised funds than other types of funds because they are frequently covered in financial media and because an organization you are affiliated with might have received grants from specific donors through their donor-advised funds. Dollars in donor-advised funds are already set aside for charitable giving, and it’s very convenient for donors to use their funds to support favorite organizations.

GPCF encourages donors to give directly.

Rest assured that the team at GPCF encourages donors to give directly to their favorite organizations when that’s the best strategy to achieve a donor’s estate planning, tax, and charitable goals. When that’s not a viable option, though, both the donor and the organization benefit from the donor using a donor-advised fund. Examples include cases where the donor wants to give a complex asset, such as real estate or closely held stock, or needs to plan out several years of giving to address fluctuating income levels and tax liability. Some donors also prefer to give anonymously, and a donor-advised fund can help with that.

Donor-advised funds are becoming increasingly popular. 

Donor-advised funds are attractive vehicles to help donors organize their giving. In turn, donor-advised fund sponsor, including GPCF, continue to channel billions of dollars in contributions annually to thousands of charities through these vehicles. When donors begin giving through a donor-advised fund, their annual support for organizations often increases significantly, underscoring donor-advised funds’ potential to deepen long-term donor engagement.

Please reach out to GPCF anytime to learn more about how these vehicles work.

The team at the community foundation is honored to serve as a resource and sounding board as you build your charitable plans and pursue your philanthropic objectives for making a difference in the community. This newsletter is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. Please consult your tax or legal advisor to learn how this information might apply to your own situation.