A donor-advised fund is an easy, low-cost, tax-efficient vehicle that helps you manage and carry out your charitable giving.
When you make a contribution to a donor-advised fund, you are making a charitable donation to a 501(c)(3) tax-exempt public charity. Consequently, you are entitled to receive the maximum tax deduction allowed by law.
A donor-advised fund gives you the privilege of recommending grants to IRS-qualified public charities – sectarian and nonsectarian – at any time. You receive regular reports on contributions, grants, investment income, fund balance, and all other activity related to your fund. You can also access your fund online.
A donor-advised fund offers advantages over checkbook charity, which requires you to track all your receipts. It is also a smart alternative to a private foundation.