Unlocking the Power of Donor Advised Funds: A Gift Planning Tool

Donor Advised Funds (DAFs) are increasingly gaining traction as a powerful tool for philanthropy. Beyond their reputation for offering tax advantages and streamlined giving, DAFs hold significant potential for strategic family philanthropy and planned giving. Let’s explore the multifaceted benefits of DAFs and how they can be utilized to maximize impact and legacy in building your philanthropic plan. 

What are DAFs and what are the benefits of CJP’s DAF program? 

Donor Advised Funds (DAFs) are charitable giving accounts administered by a public charity, providing donors with a convenient and flexible way to manage their philanthropic contributions. DAFs offer donors the option to give anonymously if desired. This can be particularly appealing for individuals who prefer to keep their charitable giving private.  

When it comes to choosing a DAF program, CJP stands out for a variety of reasons, making it an excellent choice for individuals and families looking to maximize their charitable impact while also supporting the local Jewish community. 

Why a CJP DAF is a great choice? 

Convenient online platform: CJP offers an intuitive and user-friendly online platform, allowing donors to manage their DAF easily from anywhere, anytime. 

Flexible giving options: With a CJP DAF, donors can make contributions and generate a tax deduction when they need it, then grant out funds to charities over time and in response to emerging needs, providing them with the flexibility to support causes as they see fit. 

Lower fees: CJP's DAF program offers lower fees compared to other programs, ensuring that more of your charitable dollars go directly towards making a difference in the community. 

Supports CJP's mission: Fees net of expenses from CJP's DAF program directly benefit CJP and help support its overall mission of strengthening the Jewish community and addressing critical needs locally and globally. 

Access to investment options: Donors have access to best-in-class investment options, including the Jewish Community Endowment Pool, LLP (JCEP) for larger DAFs, ensuring that their charitable assets are managed effectively for long-term growth. Assets in DAFs have the opportunity to grow tax-free, further increasing charitable assets. 

Acceptance of complex assets: CJP has the capacity to accept and manage complex, illiquid assets subject to due diligence, providing donors with additional flexibility in their giving strategies. 

Streamlined administration: Managing philanthropy becomes much easier with a CJP DAF, as donors can consolidate all their gifts, regardless of size, in one place, simplifying administration and record-keeping. 

Flexible anonymity: Donors can give totally anonymously or choose recognition on a grant-by-grant basis, ensuring their preferences are respected. 

Jewish lens: Grants made through CJP's DAF program are received with CJP branding, highlighting the Jewish source and values behind the gift and promoting communal solidarity. 

Due diligence: CJP’s due diligence ensures all grantees are qualified charitable organizations that don’t conflict with CJP’s mission, fostering donor confidence and trust. 

How can DAFs function as a tool for more strategic family philanthropy? 

Inclusive family conversations: DAFs provide a platform for engaging multiple generations in philanthropic discussions. Families can come together to identify shared values and interests, fostering a sense of unity and purpose in their charitable endeavors. DAFs also allow for the flexibility to accommodate differing philanthropic priorities among family members. 

Flexibility and adaptability: DAFs allow families to adapt their giving strategies over time in response to changing priorities and emerging needs. They can allocate funds to different causes or charities based on evolving family values and interests. 

Educational opportunities: DAFs offer a valuable educational opportunity for younger family members to learn about charitable giving, financial stewardship, and the importance of making a positive impact in the community. 

Legacy building: By naming successor advisors, families can ensure that their philanthropic values endure across generations. This enables them to pass down a legacy of giving and instill a culture of philanthropy within the family. 

How can DAFs be used as a vehicle for planned giving? 

Leaving the remainder balance to CJP or other charities: DAF holders can designate the remaining balance of their fund to be distributed to CJP or other charitable organizations upon their passing, leaving a legacy of support to the causes they care about. 

Perpetuating support through endowment: Bequests from DAFs can be used to establish restricted and permanent endowment funds at CJP, extending a donor’s philanthropic impact well beyond their lifetime. 

Naming DAF as the beneficiary of a bequest in estate plans: Including a DAF as a beneficiary in estate plans, or from a retirement account like an IRA or 401(k), enables individuals to leave a legacy while providing flexibility for future charitable giving. 

Tax Efficiency: DAFs offer tax advantages for both lifetime and planned giving. Contributions to a DAF may qualify for a charitable tax deduction in the year they are made. Additionally, by contributing appreciated assets such as securities or real estate to a DAF, donors can avoid tax on capital gains, maximizing the impact of their charitable contributions. Assets left to DAFs at death are not subject to estate tax and may reduce the tax burden on the remaining assets in the estate.

CJP does not provide tax, financial or investment advice. If you have any tax, investment or financial questions, please consult a qualified advisor or counsel. CJP operates its DAF program in conformity with all applicable tax laws, and is dedicated to assuring that our donors’ philanthropic recommendations are given the fullest consideration possible under the law. Assets contributed to a CJP DAF are subject to CJP’s exclusive legal control.

For more info on CJP’s DAF program or how to create a legacy plan with an existing DAF, contact: 
Melanie Camp 
Senior Director Growth Philanthropy, Major Gifts 
Shira Kraft 
Senior Director, Gift Planning and Endowment