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What are donor-advised funds and how can I research them?

According to the IRS, a donor-advised fund (DAF) is a separately identified fund or account that is maintained, operated, and legally controlled by a section 501(c)(3) organization, which is called a sponsoring organization. This may be a community foundation, public charity, or a charitable fund associated with an investment firm.

Increasingly, individual donors are choosing to contribute to donor-advised funds because they can advise how funds are invested and distributed, yet they can avoid the administrative requirements and operating costs involved with managing a separate private foundation.

Unlike private foundations, donor-advised funds do not have minimum payout requirements, but lawmakers are considering making similar payout rules for them. Also, these funds can be relatively anonymous because they are not required to disclose as much information about their charitable giving.

Thus, finding detailed, public information about a donor-advised fund's grantmaking activities can be challenging for grantseekers and researchers.

The Council on Foundations' Community Foundation Locator can help you find community foundations in your area.

Foundation Directory Online, our searchable database of grantmakers, also can help you find sponsoring organizations. Try a Grantmaker Type search for "public charity." You can subscribe online, or use it for free at our libraries and Funding Information Network partners.

Aside from community foundations most DAF managers don't offer any easy way for a nonprofit to introduce itself to a DAF or its customers. Some good ideas are to:

  • Make it clear on your donations page that you accept donations from DAFs.
  • Make it clear in your gift acknowledgement letters as well.
  • Visit the DAF Direct site to learn more about the DAF direct widget.

More articles about individual donors»

Selected resources below may also be helpful.

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