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What is a Donor-Advised Fund (DAF)?

Give when you can. Grant when it’s needed.

A donor-advised fund, or DAF, is a giving vehicle established at a public charity. It allows donors to make a charitable contribution, receive an immediate tax deduction and then recommend grants from the fund over time.  Donors can contribute to the fund as frequently as they like, and then recommend grants to their favorite charities whenever makes sense for them.

 

How Donor-Advised Funds Work

  1. You make an irrevocable contribution of personal assets, including cash, stock, real estate and more.
  2. You immediately receive the maximum tax deduction that the IRS allows.
  3. You name your donor-advised fund account, advisors, and any successors or charitable beneficiaries.
  4. Your contribution is placed into a donor-advised fund account where it can be invested and grow tax-free.
  5. At any time afterward, you can recommend grants from your account to qualified charities.

History and Trends

The first donor-advised funds were created in the 1930s, though regulatory recognition did not exist until the Tax Reform Act of 1969. In the 1990s, donor-advised funds began to grow in visibility and popularity, and today they are philanthropy’s fastest-growing vehicles. Grants from donor-advised funds account for more than 3 percent of all giving in the United States. For a detailed look at donor-advised fund trends, you can view our most recent Donor-Advised Fund Report.

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Discover the differences and similarities between a DAF and a private foundation.
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Receive an immediate tax deduction when you make a charitable contribution to a DAF.
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NPT has the answers to many frequent questions about DAFs.
FAQs
Explore our most recent aggregated information on donor-advised funds.
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