Donor Advised Fund (DAF) Decisions – Should I Use A Donor Advised Fund (DAF) When Giving To Public Charities?

2026 · SHOULD I USE A DONOR ADVISED FUND (DAF)
WHEN GIVING TO PUBLIC CHARITIES?
Do you make substantial charitable gifts on an annual basis?Will you make a large charitable gift this year in order to offset your income tax liability?Do you typically claim the standard deduction?Do you have highly appreciated securities?Consider bunching your charitable contributions into certain tax years to allow for itemized deductions.You can take a charitable deduction in the year of any gifts to your DAF. Although you make completed gifts for income tax purposes, you retain control over the timing of and amount of the ultimate distribution to the charity(ies).During your lifetime, you can recommend grants from your DAF to eligible charities (most 501(c)(3) public charities), to be made in the name of your DAF or anonymously.Consider gifting these assets, in kind, to your DAF. This allows you to transfer the full FMV without realizing any taxable gains.At your death, you may name charitable beneficiaries, impose a grant schedule, and/or name a successor to assume grant-making responsibilities.You can advise on the use of your contributed funds, but the DAF’s sponsoring organization must have exclusive legal control over the assets contributed.Do you want to retain control over the timing of the ultimate distribution to the charity(ies)?Do you want tomake a gift that benefits both charitable and noncharitable beneficiaries (e.g., yourself or your family)?Consider using a split-interest gift strategy, using a qualified charitable lead or remainder trust to accomplish your tax and legacy planning goals. Consider using a DAF to manage your charitable gifts, both during your lifetime and as part of your estate plan.Consider making gifts directly to the charity(ies), funded strategically (e.g., with appreciated assets, QCD, etc.).YesNoYesNoNoYesNoYesNoYesYesNoDo you intend to make numerous and/or substantial charitable gifts at your death?A DAF is not likely to be a beneficial strategy.YesNoSTART HERE
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 Dejan Ilijevski, MBA, MS

SCM Investment Services | Lake Elmo, MN | (612) 324-0629

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