Category: Donor Advised Fund
Four Ways to Take Care of a Charity - And Yourself
There’s nothing that says you can’t do good in the world and do well for yourself. You may even be able to reduce your taxes, secure and income for yourself or your beneficiaries, and help a charity or - several charities - of your choosing. Although there are many ways to accomplish your philanthropic and financial goals, today we will focus on four smart strategies. The first strategy is that of a Donor Advised Fund or DAF. A DAF has several advantages, including: There is generally a low initial minimum to open an account (usually $5,000-$10,000) There are generally low ongoing maintenance and administrative expenses There are no annual distribution requirements There are no annual tax filing requirements Gifts can be made publicly or anonymously There are higher charitable deduction limits relative to private foundations – which we will cover in just a moment! But, there are also some disadvantages. Specifically: Some donor advised funds do not allow the donor to name successors These funds do not allow compensation for board members or staff Donor advised funds don’t allow for establishing scholarship programs The second strategy is a private foundation. The advantages of a private foundation are: The donor retains complete control of the foundation The donor can engage family members to emphasize core family values and/or legacy The donor can pay reasonable compensation to board members and/or staff The fo
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