There are a handful of different ways that estate planning attorneys assist clients who would like to donate resources to charitable causes. One choice that is growing in popularity is the Donor Advised Fund.
These funds are administered by the charitable divisions of certain large financial services companies as well as community foundations and public charities.
With these funds you gain three major advantages, and we would like to highlight them here.
1.) Tax Savings
You do not have to pay taxes on capital gains when you contribute appreciated securities into a Donor Advised Fund. However, you can take a charitable deduction for the full market value of the donation to the fund.
One of the nice things about these funds is that you streamline your accounting considerably if you want to give to multiple charities because you are dealing with this one fund rather than a number of different organizations. You can request that the fund support multiple charities utilizing your contribution.
Plus, you benefit from efficient administration because the infrastructure of the fund is held in place by many different donors who share the burden. If you have a private foundation there is no such cooperative efficiency.
3.) Last Minute Contributions
When the April 15 deadline for filing your taxes is approaching you may find that you would benefit from a charitable deduction. Donor advised funds are very attractive for last-minute contributions because you don’t have to make any snap decisions with regard to granting endowments.
You can take a deduction for the market value of the contribution for the year during which it was made even if no grants have been endowed within that calendar year. For more information, contact The Zimmer Law Firm. 513.721.1513