Donor Advised Funds Bring Families Together

Tags: Planned Giving, Charitable Giving, Family

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Donor Advised Funds at the Jewish Federation of Cleveland have historically provided individuals with a near-perfect tool for effective, efficient philanthropic grant making as well as maximizing tax advantages. Donors may not realize, however, that creating a donor advised fund may also be a first step in engaging family members in the philanthropic process.

A Donor Advised Fund (DAF) is one vehicle that encourages intergenerational conversations about values and philanthropic priorities between family members.

Some donors allow their children to recommend grants of a certain amount each year, and others gather at the dinner table to make philanthropic choices together. Either way, the fund acts as a catalyst for family philanthropy.

As years pass, and family members age, a DAF can also be a valuable tool in creating a philanthropic estate plan.

Donors may recommend grants during their lifetime through their DAF. They may also recommend grants to be made upon their deaths – either liquidating the fund entirely or creating an endowment fund in their names.

Donors may designate successor advisors, often family members, giving their heirs the privilege to make grant recommendations of their own choice. The next generation then carries on the family’s value of philanthropy.

Snapshot: Donor Advised Fund Benefits

Donor advised funds provide an excellent tool for current giving, but also an effective first step to creating a meaningful philanthropic plan that benefits both the donor and the community.

  • Income is earned on all donations to the fund
  • All income generated by the fund is tax-free
  • An immediate income tax deduction is available for the amount of the initial gift
  • May be used to create endowments in perpetuity

Meet Carol Wolf

For assistance in setting up a DAF, contact Carol F. Wolf at 216-593-2805 or cwolf@jcfcleve.org.

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Learn More: Planned Giving, Charitable Giving, Family