A Donor Advised Flow Through Fund allows you to centralize your charitable dollars in one convenient account. This user-friendly fund provides maximum tax advantages and flexibility in grant making.
A Donor Advised Flow Through Fund is a non-permanent fund–the capital must be paid out within three years of the gift. Distributions can be made at any time, and are based on the donor’s recommendations to the Foundation. If the donor has not granted all the funds within three years, the balance can be used to establish an endowment.
A Donor-Advised Flow-Through Fund can help you optimize your tax burden and simplify your annual giving. Many donors have found this type of fund to be particularly beneficial in offsetting capital gains taxes on appreciated publicaly traded stocks: your donation qualifies for an immediate tax deduction and you have three years to recommend distributions from the funds to qualified beneficiary agencies.
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Advantages of a Donor Advised Fund at The Foundation
Maximum tax advantage. By transferring such marketable securities to a Donor Advised Fund, you can avoid capital gains taxes and receive an immediate fair-market-value tax deduction, while also supporting the causes you care about.
Active involvement. You and your family participate in the grant-making process by identifying specific charities or worthwhile projects and recommending grants to support them. Use your fund to support any number of causes and organizations–in the Jewish community and the community at large–and adjust your funding priorities as your charitable interests evolve over time. You can name a Donor Advised Fund for your family, and grants issued from that fund will carry your family’s name.
No limit on the number of grants. The Foundation can issue an unlimited number of grant distribution cheques from your fund at no additional charge. (Minimum grant recommendation is $100.)
Build a permanent family legacy. A Donor Advised Fund can be the first step toward building a permanent legacy. When you create your fund, you will make decisions about its use when you pass away or are no longer able to serve as the fund’s advisor. You may designate your children to recommend grants, ensuring next-generation family participation, or you may earmark balances to create an Endowment fund your name at The Foundation. If you don’t make other arrangements, the remaining balance of your Donor Advised Fund will be distributed to the Foundation’s General Heritage Fund, which primarily provides for local community needs.
How a Donor Advised Fund Works
- The donor may be an individual, a family or a corporation.
- Funds can be opened with a minimum donation of $5,000.
- All of the capital in the fund must be distributed within a three-year period after it is received. Capital will be disbursed on a first-in, first-out basis.
- The Foundation handles all administrative responsibilities, freeing you to focus on the joy of giving.
- Funds held beyond ninety days are pooled with other funds held by the Foundation and professionally managed under the oversight of our investment committee according to a conservative investment mandate. Your fund receives a pro-rated share of the income minus a share of the Foundation expenses, determined in accordance with current JCFC administrative fee policies.
Assets You Can Use to Establish Your Donor Advised Fund
- Marketable securities
- Mutual fund and REIT shares
- Bonds (corporate, municipal or State of Israel)
Grant-making Options with Your Donor Advised Fund
Through a Donor Advised Fund you can recommend grants to any beneficiary that qualifies under Canadian tax law. Our donors support a wide range of causes, locally, nationally and internationally, in both the Jewish and the general community. You can choose to support a specific organization such as a synagogue or day school, hospital or homeless shelter, environmental group or college alma mater, the annual UJA or United Way campaign in your community, to name just a few.
Because grant recommendations are processed regularly, you can also respond to emergency situations or new opportunities as soon as you hear about them.
Please consult your tax or estate planning professional to determine what is best for you.