Donor advised fund

One of the most popular giving options today. Similar to a private foundation, a donor advised fund (DAF) provides an immediate full tax benefit and lets you donate to your favorite charities, but with less expense and setup.

How donor advised funds work

A DAF administered by Raymond James Charitable provides an easy way to make significant charitable gifts with immediate tax benefits and deductions. An agreement is created between you and Raymond James Charitable, which allows you to advise how portions of the charitable gifts are used.

A horizontal left-to-right process diagram explaining how a Donor Advised Fund works. The design uses blue and gray tones with numbered steps 1, 2, and 3.

On the left side is an icon of a person labeled Donor A.

Above an arrow pointing from Donor A to the center is the text 1 Gift of Property.

Below that, an arrow points from the center back to Donor A with the text 2 Tax Deduction.

In the center is an icon of a document labeled DAF. Beneath the icon is the title Donor Advised Fund.

On the right side are three icons of people with raised hands labeled Charities.

Above an arrow pointing from the Donor Advised Fund to the Charities is the text 3 Support & Gifts.

The visual flow indicates:

Step 1 Gift of Property moves from Donor A to Donor Advised Fund.

Step 2 Tax Deduction moves from Donor Advised Fund back to Donor A.

Step 3 Support & Gifts moves from Donor Advised Fund to Charities. Overview: The donor contributes assets (e.g., property) to the DAF. The donor receives a tax deduction. The DAF distributes grants to charities over time. .jpg

No capital gains tax on long-term appreciated assets that are gifted
Immediate tax deduction for the full market value of the gift* for most assets
No excise taxes, unlike a private foundation
Assets donated are no longer part of the estate value
No minimum annual distribution requirement for DAF account holders

How the money is invested within the options offered by the fund
Which charities will ultimately receive grants from the fund
How much will be given to each charity
Who will make these decisions instead of or as a successor to you

*Any amount that can’t be deducted in the current year can be carried over and deducted for up to five succeeding years.

Additional information & forms

Essential information

Key considerations before choosing a DAF:

There are some requirements to get started.

Please review these facts and figures before choosing to open a DAF account.

A $10,000 minimum contribution is required to open an account.
There is a tiered fee schedule for investment management and administration of the account that decreases as the balance increases, with a minimum annual fee of $125.
We ask that you maintain a minimum balance of $500 in your DAF account for any market fluctuations.
Additional contributions must be a minimum of $500, however exceptions can be made if the contributions are in memorial of someone.
The minimum amount to grant to a charity out of your DAF is $100.
Grants take 3-10 business days to process because each charity is reviewed for approval according to IRS requirements for DAF distributions.

Grants from your DAF must meet certain tax criteria.

Because your contribution is fully tax deductible at the time of the donation, all grants recommended out of your DAF must satisfy IRS rules for full deductions. For this reason, grants from a DAF cannot be used in certain cases.

We cannot make grants in lieu of a pre-existing pledge.

This is because, for the IRS, a pledge has the appearance of a personal debt, so fulfilling that debt would be seen as a personal benefit.

We cannot make grants to private non-operating foundations.

Private non-operating foundations can’t receive gifts because they have different tax treatments. Therefore, you can’t earn a 100% tax deduction through your contribution to a DAF and then pass those funds to a private foundation when a donation directly to that foundation would have earned a lesser deduction. However, while a DAF cannot pay into a private foundation, the reverse is acceptable. So, if you are considering both giving options, know that you are able to move your funds directly from a private foundation to a DAF.

Other limitations

Remember, because contributions into a DAF provide you with a full tax write-off, gifts out of your DAF account cannot pay for things that are only partially deductible, such as pay dues or membership fees, purchase tickets to a benefit or purchase goods at a charitable auction. Grants may not be used for lobbying, political contributions or political campaigns.

Grant recommendations can be made to the charity of your choice.

You can change your investment approach.

A DAF cannot purchase insurance on a donor’s life.

Contributions to your DAF cannot be withdrawn later.

Naming Raymond James Charitable as the beneficiary.

Individuals have the opportunity to name Raymond James Charitable as beneficiary of their will, trust, IRA, annuity contract or life insurance policy. By doing so, they can create a "planned gift" that will be distributed to Raymond James Charitable after their death. To set up this type of arrangement, the attorney must use the legal name "Raymond James Charitable Endowment Fund" as the name of the beneficiary. To learn more, view the Planned Gift Donor Account Application.

Liberty investment objectives

Assets contributed to Raymond James Charitable are invested tax free. At the time of your contribution, you may recommend that your contribution be invested in any of seven investment objectives:

Money market

Income

Income with growth

Balanced

Growth with income

Growth

Sustainable Focused balanced

Investment Advisor Program (IAP)

In addition to these investment objectives, accounts with market values of at least $500,000 may choose to use the Investment Advisor Program (IAP) option. This allows the donor to nominate his or her financial advisor to provide investment advice to the investment manager, Raymond James Trust, for assets held in the account.

Let us tailor a plan

We can help you create a charitable giving plan that helps the organizations you’re passionate about and furthers your overall wealth management.

Get started today