Have you been hearing more about DAFs (donor advised funds) recently? Learn about the type of gift that lets you make an impact and instantly get benefits.
What is a donor advised fund?
A donor advised fund (DAF) is a charitable giving account that lets you donate money and receive an immediate tax deduction. It’s like a personal charitable fund managed by a sponsoring organization (such as Fidelity Charitable or Schwab Charitable), a community foundation (such as Baltimore Community Foundation), or a religious sponsor. You can contribute cash, stocks, or other assets, which are invested and can grow tax-free. When you’re ready, you choose which charities to support—like Sheppard Pratt—and recommend grants to these nonprofits over time. It’s a flexible, easy, and efficient way to make a lasting impact on the causes that matter to you.
Here’s how it works:
Choose a sponsoring organization.
Select a trusted DAF provider, such as Fidelity Charitable, Schwab Charitable, Vanguard Charitable, or a local community foundation.
Open your account.
Complete the application online or through your chosen provider. You can name your fund (e.g., The Smith Family Giving Fund) and select investment options for your contributions.
Make a contribution.
Fund your DAF with cash, stocks, or other assets. You’ll receive an immediate tax deduction for your gift.
Recommend grants.
At any time, you can recommend grants to disperse to eligible nonprofits—like Sheppard Pratt—to support the causes that matter most to you.