Gifts Through a Donor Advised Fund
A donor-advised fund (DAF) is easier to establish than a private foundation and lets you support Princeton Day School over time, including with relatively small amounts.
How does it work?
When you open a donor advised funds (DAF), you are creating a separate entity with the sole purpose of using the assets under management to support qualified charities.
You fund it by irrevocably contributing assets such as cash, appreciated stock, insurance proceeds, or other property. Because the contribution is a completed gift to a public charity, you may be able to claim a charitable deduction in the year you contribute, subject to the usual limits.
As advisor to the fund, you can elect to manage the investments personally or choose to have an investment advisor manage the portfolio.
The two primary avenues of supporting PDS with your donor advised fund are through a beneficiary designation and recommending grants.
Beneficiary
By assigning PDS or other charitable organizations as a beneficiary, you are ensuring that when the DAF ceases to have an advisor the assets in the account get transferred to PDS.
Grants
While you or your assigned successor(s) are advising the fund, you can recommend grants from the fund to support PDS or other charitable organizations.
What are the Benefits?
- You may be able to claim a charitable deduction in the year you contribute.
- Assets in the fund can grow without current tax to you.
- Easier and less expensive to establish than a private foundation.
- Many sponsors let you start with a relatively small amount.
- Can support a "bunching" approach, in which you combine several years of giving into one tax year.
If you have questions about setting one up, or would like more information, please contact Princeton Day School. We encourage you to review the details with your own legal and financial advisors.