Creating your family legacy with a donor advised fund

4/17/2015

How would you like to make a gift today that would enable you and your loved ones to continue to make charitable gifts in the future?

 

Establishing a Donor Advised Fund (DAF) with The Oklahoma United Methodist Foundation accomplishes this and more for both the donor AND the charitable organization.

A few of the advantages are as follows:

 

Simplifies Charitable Gifting

Many philanthropic families consider establishing a private foundation. A private foundation offers control and name recognition. However, there are very strict private foundation rules in the Internal Revenue Code, which can be quite burdensome and expensive. The DAF is more cost effective and far less cumbersome than setting up and maintaining a private foundation. It offers greater privacy and the favorable tax consequences and efficient administration of the public charity. Additionally, the family can be involved on a long term basis in the grant-making process of their family fund.

 

Favorable Tax Consequences

Families can make donations to their DAF and receive very favorable tax consequences. The donations may be made at any time during the year without having to decide at the same time which United Methodist causes or other charitable organization will receive funds from the DAF. This is especially beneficial if the family donates highly appreciated stock or real estate. The stock or real estate can be donated to the DAF at fair market value and the donor will receive an immediate tax benefit and avoid capital gains tax. Grants from the DAF can be made at a later time.

 

A Legacy Planning Tool

For families who wish to receive income for life, avoid estate taxes, and pass on a legacy of family values, the DAF can be named as the ultimate beneficiary of a charitable remainder trust or a charitable gift annuity. The DAF can also be named as the beneficiary of a bequest. In both cases the heirs can advise the fund, thus maintaining control and maximizing the influence of the family’s legacy.

 

Makes the Giving Process Easier

The family DAF can support multiple United Methodist causes and other charities. For example, the family fund can make distributions to the church’s capital campaign, annual budget and special offerings throughout the year, which simplifies the giving process. The family receives quarterly statements from the Foundation itemizing grants made from the family fund.

 

Easy to Establish

The family DAF is very easy to establish. (1) Call the Foundation and request a copy of the Memorandum of Understanding. (2) Select the name of the fund. Examples of fund names might be The ___________Family Charitable Fund, The __________Philanthropic Fund, The _________Family Foundation, etc. (3) Make an initial contribution of cash, stock or real estate of $10,000 or more.

 

The Oklahoma United Methodist Foundation’s Donor Advised Fund helps your family accomplish your philanthropic goals through a very flexible and convenient vehicle. Please contact David Battles at 800-259-6863 or dbattles@okumf.org  with any questions or for more information.

 

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