Donor Advised Funds Explained. What Is A Donor Advised Fund?

Donor-Advised Funds Explained

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[zenalotz]

You didn't mention that from the tax side the biggest benefit is being able to overcome the itemized deductions standard deduction gap. In a normal year a person has around a $12k standard deduction and if you give only $12k a year (and no other itemized deductions) then you technically have not benefited at all from donating (you have to choose to take the itemized deduction or the standard, not both). DAF's allow you to do a lump sum less that $12k in one year that will be used for many years to come rather than losing that $12k of value each and every year you want to donate.

i.e $50k in year 1 gets you a $38k actual benefit. If you instead gave $10k for 5 years directly to charities then you would be receiving no additional benefit over the standard deduction each year.

[workingTchr]

It sounds like charitable income averaging (that we once had).

[kevinkobayashi]

Is there a maximum that can go into a donor advised fund?

[alchemista]

You should have mentioned the high fees associated with these. Finance companies love them.