DAF for church offering? [Donor Advised Fund]

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duckcalldan
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DAF for church offering? [Donor Advised Fund]

Post by duckcalldan » Mon Dec 26, 2016 8:45 am

I'm pretty sure I'm going to open a donor advised fund with Fidelity next year as I have plenty of LTCG and it just makes sense to switch my giving from cash to appreciated securities. Our giving is around $5K annually but I can see this figure increasing slightly over the next few years as we adjust to life in early retirement.

Probably half of our giving is to our local church, where we have been giving our offering twice a month through EFT. It seems feasible that we could do the same level of giving from our DAF but switch to once a month just to keep the annual grants to a minimum. Any experience with regular DAF giving throughout the year?

letsgobobby
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Re: DAF for church offering?

Post by letsgobobby » Mon Dec 26, 2016 9:20 am

yes, we do this. very easy. highly recommended.

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dm200
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Re: DAF for church offering?

Post by dm200 » Mon Dec 26, 2016 10:49 am

duckcalldan wrote:I'm pretty sure I'm going to open a donor advised fund with Fidelity next year as I have plenty of LTCG and it just makes sense to switch my giving from cash to appreciated securities. Our giving is around $5K annually but I can see this figure increasing slightly over the next few years as we adjust to life in early retirement.
Probably half of our giving is to our local church, where we have been giving our offering twice a month through EFT. It seems feasible that we could do the same level of giving from our DAF but switch to once a month just to keep the annual grants to a minimum. Any experience with regular DAF giving throughout the year?
Yes, we do that - but not regular scheduling. It works very well and you can set up with Fidelity that a regular amount goes every month.

We also designate some funds for certain causes to the same place of worship. Perhaps a "Capital fund", "Outreach fund", etc. That is easy to do when requesting a "grant"

The only "issue" (not a problem for us, since we know the rules) is that this amount from the Fidelity DAF is "acknowledged" as a charitable donation each year. We cannot, of course, deduct grants from Fidelity. I would just keep good records yourself of the Fidelity grants vs. funds given directly.

Saving$
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Re: DAF for church offering?

Post by Saving$ » Mon Dec 26, 2016 11:23 am

A DAF can be valuable, but there is about a $100/year cost associated with it. It seems to offer the most value if you don't have RMD's and also don't have itemized deductions. You can donate a chunk to the DAF before you retire to take advantage of the itemized deduction. If you itemize anyway, and/or have RMD's from an IRA, consider two alternatives.

1. If you will continue to itemize after retirement regardless of charitable contributions, and your holdings are securely in Capital Gains territory, you may wish to simply forgo the cost of the DAF and give an annual gift of appreciated securities to your church. You can also give to other organizations in this method - I would draw a line at any other organization that is either already set up to receive donated securities and to whom you are gifting more than about $500 or to any organization to whom you are gifting more than about $2k (worth it to set them up to receive the donated securities). This will save you the DAF fee. The small loss of tax savings for those $25/$50 donations is far outweighed by the $100/yr savings in DAF fees.

2 If you are receiving RMD's from an IRA an even better way to donate is to send QCD's - Qualified Charitable Distributions. Instead of you taking the RMD, the IRA sends part of your RMD as a joint check to you and the charity. This works better for charities as it is a check they can deposit, without involving their brokerage. It works better for you, because instead of needing to itemize to realize the tax benefit of the contribution, it simply lowers your overall income. In doing so, it also helps on the computation of Medicare premiums.

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Re: DAF for church offering?

Post by tnr » Mon Dec 26, 2016 12:34 pm

Your church will need the correct 501c designation for the DAF to make the contribution. Usually, this is not an issue but some small churches don't have this.

I donate from my DAF to my church but only once per year so I do it manually as opposed to by a scheduler.

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dm200
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Re: DAF for church offering?

Post by dm200 » Mon Dec 26, 2016 1:54 pm

tnr wrote:Your church will need the correct 501c designation for the DAF to make the contribution. Usually, this is not an issue but some small churches don't have this.
I donate from my DAF to my church but only once per year so I do it manually as opposed to by a scheduler.
I have requested "grants" to 4 or 5 churches (several very, very small) over the years and have never had a problem (Fidelity). Years ago, it was my experience that some churches are not able to handle (well) donation of appreciated securities.

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Re: DAF for church offering?

Post by GreenGrowTheDollars » Mon Dec 26, 2016 4:09 pm

Consider asking your church whether they have received donations from a Donor Advised Fund.

Some DAF's have gotten very picky about the paperwork that has to be supplied by the charity before they will release the donation. Two last year wanted us to obtain a legal opinion that would have cost us $4.5K/5K (two bids) to obtain concerning the specific charitable subtype we were under the IRS rules. (Apparently newer 501(c)(3) charities get this determination when they get their initial IRS decision on 501(c)(3) status, but long-established charities were created before all these different Type I, Type II, or Type III status determinations were established.)

Not that the charity with which I am familiar is not a church. Perhaps they have separate/easier rules.

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dm200
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Re: DAF for church offering?

Post by dm200 » Mon Dec 26, 2016 4:18 pm

GreenGrowTheDollars wrote:Consider asking your church whether they have received donations from a Donor Advised Fund.
Some DAF's have gotten very picky about the paperwork that has to be supplied by the charity before they will release the donation. Two last year wanted us to obtain a legal opinion that would have cost us $4.5K/5K (two bids) to obtain concerning the specific charitable subtype we were under the IRS rules. (Apparently newer 501(c)(3) charities get this determination when they get their initial IRS decision on 501(c)(3) status, but long-established charities were created before all these different Type I, Type II, or Type III status determinations were established.)
Not that the charity with which I am familiar is not a church. Perhaps they have separate/easier rules.
No, do not ask!! They may not know. Just find the church on the DAF site and request the grant. Chances are the church is right there.

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Re: DAF for church offering?

Post by jebmke » Mon Dec 26, 2016 4:25 pm

Saving$ wrote:A DAF can be valuable, but there is about a $100/year cost associated with it.
the administrative fee for the Vanguard DAF is .6% of assets for small ones (under $500K). I think Fidelity's fees are pretty similar to VG. These fees are on top of the normal expense incurred by the funds in which your DAF is invested.
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Re: DAF for church offering?

Post by leonard » Mon Dec 26, 2016 4:34 pm

Why not just do a single donation a year and let the church manage the monthly budgeting out of the cash flow?

Way less admin for you.
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Re: DAF for church offering?

Post by RudyS » Mon Dec 26, 2016 4:42 pm

Duplicate.sorry.see below.
Last edited by RudyS on Mon Dec 26, 2016 9:47 pm, edited 1 time in total.

letsgobobby
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Re: DAF for church offering?

Post by letsgobobby » Mon Dec 26, 2016 4:43 pm

jebmke wrote:
Saving$ wrote:A DAF can be valuable, but there is about a $100/year cost associated with it.
the administrative fee for the Vanguard DAF is .6% of assets for small ones (under $500K). I think Fidelity's fees are pretty similar to VG. These fees are on top of the normal expense incurred by the funds in which your DAF is invested.
with a minimum annual fee of $100.

You can choose their very inexpensive index funds and those costs are comparable to Vanguard's.

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Re: DAF for church offering?

Post by RudyS » Mon Dec 26, 2016 4:47 pm

Churches are by their nature tax-exempt. They may or may not have formal 501C3 paperwork, but the last time I encountered this was many years ago, and a Fidelity DAF was able to contribute to our small, not 501C3-documented, synagogue, for several years till I stopped using DAF. [Just checked IRS Pub 526 to verify current regs]

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Re: DAF for church offering?

Post by duckcalldan » Mon Dec 26, 2016 5:29 pm

leonard wrote:Why not just do a single donation a year and let the church manage the monthly budgeting out of the cash flow?

Way less admin for you.
Most folks donate to their church 52 times a year via the offering plate. I have EFT transfers twice a month. Churches depend on regular offerings, supplemented by one-off donations (especially at years end). Regular offerings are also a discipline; a consistent reminder that all that we have is ultimately His. Monthly donations seem like a good compromise, and doesn't require much more admin on my part.

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Re: DAF for church offering?

Post by leonard » Mon Dec 26, 2016 5:45 pm

duckcalldan wrote:
leonard wrote:Why not just do a single donation a year and let the church manage the monthly budgeting out of the cash flow?

Way less admin for you.
Most folks donate to their church 52 times a year via the offering plate. I have EFT transfers twice a month. Churches depend on regular offerings, supplemented by one-off donations (especially at years end). Regular offerings are also a discipline; a consistent reminder that all that we have is ultimately His. Monthly donations seem like a good compromise, and doesn't require much more admin on my part.
Ok, but sometimes a break from tradition makes us more efficient.

I'd personally leave it to the church to divide by 12 and manage their own budget and make it much easier on myself. They get the same amount - just happens to come all at once. Also, the church incurs a slightly smaller amount of overhead managing one Xfer per year - versus 12 (or 52 or whatever). Plus, having the amount up front - eliminates risk in financial planning for them.

Also, this might allow you to manage the timing of donations for tax purposes in particular years.

Anyway, seems to me there is some upside to my suggestion - but then I don't have a horse in it.
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Re: DAF for church offering?

Post by GreenGrowTheDollars » Mon Dec 26, 2016 7:50 pm

RudyS wrote:Churches are by their nature tax-exempt. They may or may not have formal 501C3 paperwork, but the last time I encountered this was many years ago, and a Fidelity DAF was able to contribute to our small, not 501C3-documented, synagogue, for several years till I stopped using DAF. [Just checked IRS Pub 526 to verify current regs]
Whatever changed has hit our charity in the past 18 months. We've been getting these donations for years, but suddenly we have to provide a lot more information. And -- something that may be important for church donations -- DAF designated funds cannot be used to fulfill a pledge.
https://www.philanthropy.com/article/Op ... -on/232197

We love getting donations, but the DAF's have become more challenging. YMMV.

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Re: DAF for church offering?

Post by J295 » Mon Dec 26, 2016 7:58 pm

We have no issues whatsoever with the FIDO DAF distributing to our parish and other Catholic related organizations, in addition to other local charities.

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Re: DAF for church offering?

Post by Artsdoctor » Tue Dec 27, 2016 12:55 am

GreenGrow,

That is a surprisingly selfish article in the Journal of Philanthropy.

Any charity needs to be upfront with a donor that a $5,000 gift is only $4,000 deductible. Any serious philanthropist is going to understand this distinction. You're going to get a donor's anger upfront (when he realizes the DAF can't be used) or at the end of the year (when he gets the letter in the mail thanking him for the personal donation check that was only 80% deductible).

The legally binding annual contribution pledge is an obstacle. But we've pledged annual contributions for a decade to our alma mater and have a letter releasing us from any legal binding contract that satisfies the DAF.

But the bottom line is this. DAFs often PROMOTE more giving. Once you've transferred your assets into your DAF, everyone I know actually INCREASES their giving in aggregate. Furthermore, we now actually turn down those gifts, which were really not that great to begin, to be able to donate the full amount of large contributions to charities we care about. And for those membership contributions which cannot be separated from gifts of some sort, we still give just by check.

There's something very wrong with a charity that complains about the extra paperwork required to extract money from donors. If a charity is going to host an event with a $50,000 table, as described in the article, they can afford to employ a decent VP of Gifting who knows what he's doing, and hopefully doesn't whine too much about his job requirements.

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dm200
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Re: DAF for church offering?

Post by dm200 » Tue Dec 27, 2016 4:08 pm

And -- something that may be important for church donations -- DAF designated funds cannot be used to fulfill a pledge.
There are "pledges" and then there are "pledges". Let me elaborate from BOTH sides of the issue. Being affiliated with an organization that has conducted several, successful building and capital campaigns over the last few decades, there are many reasons that promoting "pledges" (to be fulfilled over, say, 3-5 years or more) can be a vital part of a successful campaign. In these campaigns I have been involved in, these "pledges" were not (and were not regarded as) contractually binding. We even said so. One (of many) reason for getting "pledges" was that, in order for building/work to begin, we needed to show the near certainty that the needed funds would be raised.

The only problem I ever had (and it was resolved easily) with Fidelity DAF was one time when my wording of the grant request hinted at fulfilling a "pledge". Fidelity, also, now makes it much more clear that you can fulfill funding such a non-binding "pledge" as well.

Bottom line: For a capital type (or similar) campaign, I would not hesitate to make a non-binding pledge to be satisfied by grants from a DAF. Neither would I hesitate to request a grant to fulfill a non-binding "pledge". Just make sure you use a description such as "Capital Campaign".

Maybe others can cite experiences, but I wonder how frequent it is that an organization considers a "pledge" for such a campaign to be "legally binding"?

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Re: DAF for church offering?

Post by dm200 » Tue Dec 27, 2016 4:23 pm

Whatever changed has hit our charity in the past 18 months. We've been getting these donations for years, but suddenly we have to provide a lot more information. And -- something that may be important for church donations -- DAF designated funds cannot be used to fulfill a pledge.
https://www.philanthropy.com/article/Op ... -on/232197
We love getting donations, but the DAF's have become more challenging. YMMV.
My comments:
1. From many years using the Fidelity DAF, it is 100% clear that you cannot receive anything but "incidental" benefits from a DAF grant.
2. It seems to me that a well run, mainstream type charity/church/etc. should be able to predict quite accurately the amount of non-binding pledges to be collected.

It seems to me that the DAFs are following the IRS and other rules. Perhaps the difficulty (if there is one) lies with the receiving entity and not with the DAF. As a Fidelity DAF participant, I have encountered ZERO problems. The grants have gone to several entities - some large and some very small - and the religious based one have gone to 4 or five different destinations in various areas and to 3 different "denominations".

Although I have never used one, I note that many religious/denominational entities have started their own DAFs. Maybe (do not know) if you plan to contribute only to that denomination/religion/etc. such a DAF might make some sense? Keep in mind, though, that there might be additional hurdles if it were (or were perceived) that a grant request was to an entity that was in violation of that denomination's core beliefs.

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Re: DAF for church offering?

Post by pshonore » Tue Dec 27, 2016 4:26 pm

And am I correct in assuming a "pledge" of $x/ week,month, etc for general Church purposes would not be a problem for the DAF to issue checks quarterly, etc.(assuming the minimum is met for a check)?

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Re: DAF for church offering?

Post by dm200 » Tue Dec 27, 2016 5:07 pm

pshonore wrote:And am I correct in assuming a "pledge" of $x/ week,month, etc for general Church purposes would not be a problem for the DAF to issue checks quarterly, etc.(assuming the minimum is met for a check)?
I have not done this (with Fidelity), but I am quite sure this would be possible with most (if not all) DAFs. I assume this "pledge" is not legally binding. I would not use the word "pledge" in the DAF grant request.

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Re: DAF for church offering?

Post by FIREchief » Tue Dec 27, 2016 6:06 pm

dm200 wrote:
pshonore wrote:And am I correct in assuming a "pledge" of $x/ week,month, etc for general Church purposes would not be a problem for the DAF to issue checks quarterly, etc.(assuming the minimum is met for a check)?
I have not done this (with Fidelity), but I am quite sure this would be possible with most (if not all) DAFs. I assume this "pledge" is not legally binding. I would not use the word "pledge" in the DAF grant request.
I believe this is correct. That said, I wish our churches would drop "pledge" from their collective vocabularies and just let our "yes be yes and our no be no." If we say "yes, I will support this," then that should be sufficient.
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Re: DAF for church offering?

Post by dm200 » Tue Dec 27, 2016 6:15 pm

That said, I wish our churches would drop "pledge" from their collective vocabularies and just let our "yes be yes and our no be no." If we say "yes, I will support this," then that should be sufficient
.

I certainly understand this point of view and (from sitting in the pew) tend to agree. On the other hand, when on the other side, there are many reasons for the various "pledge" approaches. Perhaps a more "acceptable" term might be "planned" vs "pledged".

Occasionally, I encounter folks who also do not like the "pledge" request. I tell them. "That is 100% OK. Just make the donation(s) over time as best you want to do and can do. It is all fully appreciated."

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Re: DAF for church offering? [Donor Advised Fund]

Post by Artsdoctor » Tue Dec 27, 2016 10:21 pm

One perspective regarding "pledge" that I have been involved with, which might help illustrate.

I have been involved as a major donor with helping to fund a building. There is a benefit for the charity to amass "money that is legally committed" in order to finance the building project, and I did pledge a certain amount with a "legally binding agreement." This actually was understandable since those legally binding documents presumably assisted the charity in obtaining financing; I had no problem with the process at all. Instead of using a DAF, I simply transferred shares of appreciated mutual funds to the charity directly. The charity itself gave me several ways of donating and were happy to accommodate anything, really.

For your church, just look up their tax ID number. I'm sure they have tax-exempt status. If they do, I can't imagine the problem with setting up a recurring monthly donation through your DAF. The check will arrive and you will have contributed. However, I would let them know what you're doing once everything is set up; I have contributed to a couple of religious organizations that, while serving a valuable need in the community, had very disorganized bookkeeping and mail room staff (disappointing, but what can you do?). Or, you can simply monitor the checks through your DAF; when the check is cashed, you'll be able to see it on your charity roster.

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Re: DAF for church offering?

Post by FIREchief » Tue Dec 27, 2016 10:50 pm

dm200 wrote:
That said, I wish our churches would drop "pledge" from their collective vocabularies and just let our "yes be yes and our no be no." If we say "yes, I will support this," then that should be sufficient
.

I certainly understand this point of view and (from sitting in the pew) tend to agree. On the other hand, when on the other side, there are many reasons for the various "pledge" approaches. Perhaps a more "acceptable" term might be "planned" vs "pledged".

Occasionally, I encounter folks who also do not like the "pledge" request. I tell them. "That is 100% OK. Just make the donation(s) over time as best you want to do and can do. It is all fully appreciated."
Obviously, I was providing a biblical reference, so maybe not of use to others in a non-Christian context. I fully appreciate the efforts of those who are trying to keep our churches healthy and vibrant. The need for "pledge drives" is more of an indictment on us than our churches' leadership.
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Re: DAF for church offering? [Donor Advised Fund]

Post by motorcyclesarecool » Tue Dec 27, 2016 10:59 pm

We use the Fidelity DAF to fund our giving to our church through appreciated securities. We have automatic monthly giving setup. We also use it to fund missionaries. Those to whom our giving came in under the $50 per month threshold, we switched to quarterly automatic giving. We make sure to destroy any tax receipts issued to us in error.

Another benefit of the Fidelity DAF is their fabulous app. We can give right in the pew for any special appeal. We have also been able to give in response to finding out about disasters in the news.

Fidelity Charitable's grant approval process is pretty quick normally, but recently they made a point of expediting gifts containing a reference to Hurricane Matthew relief in the designation. I view this as another benefit of using Fidelity Charitable. Very well run.

I originally used the DAF as a way to get rid of highly appreciated shares, but in the future, we intend to use it for aggressive deduction bunching.
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Re: DAF for church offering? [Donor Advised Fund]

Post by dm200 » Tue Dec 27, 2016 11:14 pm

The need for "pledge drives" is more of an indictment on us than our churches' leadership.
Not necessarily, in my opinion. My "giving" (within my capacity) is based on several factors. One factor is the "need" of the organization. Even in well run organizations, with generous donors, there can be a need for a building drive or capital campaign, etc.

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Re: DAF for church offering?

Post by GreenGrowTheDollars » Tue Dec 27, 2016 11:51 pm

Artsdoctor wrote:GreenGrow,
There's something very wrong with a charity that complains about the extra paperwork required to extract money from donors. If a charity is going to host an event with a $50,000 table, as described in the article, they can afford to employ a decent VP of Gifting who knows what he's doing, and hopefully doesn't whine too much about his job requirements.
As a volunteer ($0 pay) treasurer with a small charity, I'm simply noting that it has become more complicated on the receiving end than it was five or ten years ago. I may have to supply:
- A completed 1-2 page form requiring various bits of information about our charity and confirmations that we will/won't do certain things and whether we are a (for example) a Type III functionally integrated organization, and whether that was determined by the IRS or by an attorney's opinion or self-certified
- Copy of our IRS determination 501(c)(3) letter (despite the fact that the status can be checked on-line with the IRS)
- A copy of our bylaws
- A copy of a brochure or other document describing what we do
- IRS W-9 (Request for Taxpayer Identification Number and Certification)

...and I have to pull all this together without any advance info from the DAF as to how large the grant will be. One I did in October turned out to be for $50. Any given DAF will probably only require me to do this once/year or /two years, but there are a lot of DAF's beyond Fidelity, Schwab and Vanguard.

Perhaps churches face less of a burden than do other kinds of charities, but my guess is that outside of mega-churches, most churches operate with a lot of volunteer labor much like our charity. We don't have a VP of Gifting, there isn't a large administrative support organization and volunteers handle most of the work. We appreciate all gifts, whether they're via checks, stock, DAF's, or bequests. The OP asked a question about DAF's, and my response was to provide some context of what it might be like on the receiving end for a smaller entity.

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Re: DAF for church offering? [Donor Advised Fund]

Post by dm200 » Wed Dec 28, 2016 11:02 am

Perhaps churches face less of a burden than do other kinds of charities, but my guess is that outside of mega-churches, most churches operate with a lot of volunteer labor much like our charity. We don't have a VP of Gifting, there isn't a large administrative support organization and volunteers handle most of the work. We appreciate all gifts, whether they're via checks, stock, DAF's, or bequests. The OP asked a question about DAF's, and my response was to provide some context of what it might be like on the receiving end for a smaller entity.
My understanding is that churches do not need to go through most of these steps every year. One church I request a small "grant" for almost every year is a very, very small rural church - and I am sure they have primarily volunteer staff. Never a problem.

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Re: DAF for church offering?

Post by 8foot7 » Wed Dec 28, 2016 6:04 pm

GreenGrowTheDollars wrote:
Artsdoctor wrote:GreenGrow,
There's something very wrong with a charity that complains about the extra paperwork required to extract money from donors. If a charity is going to host an event with a $50,000 table, as described in the article, they can afford to employ a decent VP of Gifting who knows what he's doing, and hopefully doesn't whine too much about his job requirements.
As a volunteer ($0 pay) treasurer with a small charity, I'm simply noting that it has become more complicated on the receiving end than it was five or ten years ago. I may have to supply:
- A completed 1-2 page form requiring various bits of information about our charity and confirmations that we will/won't do certain things and whether we are a (for example) a Type III functionally integrated organization, and whether that was determined by the IRS or by an attorney's opinion or self-certified
- Copy of our IRS determination 501(c)(3) letter (despite the fact that the status can be checked on-line with the IRS)
- A copy of our bylaws
- A copy of a brochure or other document describing what we do
- IRS W-9 (Request for Taxpayer Identification Number and Certification)

...and I have to pull all this together without any advance info from the DAF as to how large the grant will be. One I did in October turned out to be for $50. Any given DAF will probably only require me to do this once/year or /two years, but there are a lot of DAF's beyond Fidelity, Schwab and Vanguard.

Perhaps churches face less of a burden than do other kinds of charities, but my guess is that outside of mega-churches, most churches operate with a lot of volunteer labor much like our charity. We don't have a VP of Gifting, there isn't a large administrative support organization and volunteers handle most of the work. We appreciate all gifts, whether they're via checks, stock, DAF's, or bequests. The OP asked a question about DAF's, and my response was to provide some context of what it might be like on the receiving end for a smaller entity.
I can appreciate that in some instances there might be some extra paperwork involved but at the end of the day, it doesn't sound like my problem.

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Re: DAF for church offering? [Donor Advised Fund]

Post by Artsdoctor » Wed Dec 28, 2016 7:02 pm

Green,

Your point is well-taken, and your personal experience is a good one (however, the article from the Journal of Philanthropy was really what I took issue with).

In a way, it's a little like using your American Express card at a small, family-owned business to buy $10 worth of candy. As a consumer, you can do it, but don't you think it would be nice gesture to just pay cash? For a really small charity operating on a shoe-string, you may want to forego the DAF grant for $50 and write a check.

There are really several ways to give, and a person who's inclined to do so should realize that. You can just put the cash in the bucket, you can write a check, you can donate appreciated shares directly, you can go through your DAF, and then you can even get more complicated with a foundation. It's pretty reasonable to pick and choose which one is most appropriate for the moment.

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snackdog
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Re: DAF for church offering? [Donor Advised Fund]

Post by snackdog » Thu Jul 25, 2019 9:53 am

If one contributes to a charity through via a previously funded DAF, will an employer typically still match the annual distributions from the DAF?

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dm200
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Re: DAF for church offering? [Donor Advised Fund]

Post by dm200 » Thu Jul 25, 2019 10:08 am

snackdog wrote:
Thu Jul 25, 2019 9:53 am
If one contributes to a charity through via a previously funded DAF, will an employer typically still match the annual distributions from the DAF?
I suspect not - since the money funding the target charity is not really "your" money; it want to a charity (the DAF) when the DAF was previously funded.

Mike Scott
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Re: DAF for church offering? [Donor Advised Fund]

Post by Mike Scott » Thu Jul 25, 2019 10:13 am

I would think this was an employer specific question. How many employers match charitable contributions in any form?

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dm200
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Re: DAF for church offering? [Donor Advised Fund]

Post by dm200 » Thu Jul 25, 2019 10:15 am

Mike Scott wrote:
Thu Jul 25, 2019 10:13 am
I would think this was an employer specific question. How many employers match charitable contributions in any form?
Yes - all depends on the details of employer plan details.

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Artsdoctor
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Re: DAF for church offering? [Donor Advised Fund]

Post by Artsdoctor » Thu Jul 25, 2019 12:02 pm

snackdog wrote:
Thu Jul 25, 2019 9:53 am
If one contributes to a charity through via a previously funded DAF, will an employer typically still match the annual distributions from the DAF?
There is no harm in asking. They're not obligated to do it, but I think that there would be a good chance they might. I've found that if I contribute to a favorite charity during a fund drive when donations are matched, they will honor a printout from my DAF as good enough to have the contribution matched by another donor. I think that each case would be unique.

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dm200
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Re: DAF for church offering? [Donor Advised Fund]

Post by dm200 » Thu Jul 25, 2019 12:05 pm

Artsdoctor wrote:
Thu Jul 25, 2019 12:02 pm
snackdog wrote:
Thu Jul 25, 2019 9:53 am
If one contributes to a charity through via a previously funded DAF, will an employer typically still match the annual distributions from the DAF?
There is no harm in asking. They're not obligated to do it, but I think that there would be a good chance they might. I've found that if I contribute to a favorite charity during a fund drive when donations are matched, they will honor a printout from my DAF as good enough to have the contribution matched by another donor. I think that each case would be unique.
I would be curious about this as well.

NotWhoYouThink
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Re: DAF for church offering? [Donor Advised Fund]

Post by NotWhoYouThink » Thu Jul 25, 2019 12:19 pm

snackdog wrote:
Thu Jul 25, 2019 9:53 am
If one contributes to a charity through via a previously funded DAF, will an employer typically still match the annual distributions from the DAF?
My Megacorp will not. You can ask yours what their policy is.

Also, the charities around here that provide state tax credits wouldn't provide them to me for anything my DAF contributed.

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FIREchief
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Re: DAF for church offering? [Donor Advised Fund]

Post by FIREchief » Thu Jul 25, 2019 2:06 pm

I once tried involving my Megacorp in charitable giving and it was awful. Only after I set it up did I discover that, while they promptly removed the designated amount from my paychecks, they simply accumulated them in a slush fund until they got around to sending a check to the charity. I believe it was taking several months before the money would show up at the charity. I don't believe they were matching anything, just trying to take credit for the charitable activities of their employees. When they ultimately added a match, the "approved" charities were entirely limited to local community non-religious organizations.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

MikeG62
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Re: DAF for church offering? [Donor Advised Fund]

Post by MikeG62 » Fri Jul 26, 2019 5:43 am

duckcalldan wrote:
Mon Dec 26, 2016 8:45 am
I'm pretty sure I'm going to open a donor advised fund with Fidelity next year as I have plenty of LTCG and it just makes sense to switch my giving from cash to appreciated securities. Our giving is around $5K annually but I can see this figure increasing slightly over the next few years as we adjust to life in early retirement.

Probably half of our giving is to our local church, where we have been giving our offering twice a month through EFT. It seems feasible that we could do the same level of giving from our DAF but switch to once a month just to keep the annual grants to a minimum. Any experience with regular DAF giving throughout the year?
Yes we do exactly this with our DAF. We have the funds sent once a month to the church. Could do more often, but this seems sensible.

We did have to get our church added to Fidelity' list of approved organizations. That took about a week after we submitted the details. It has worked smoothly since (and been doing this for several years now).
Real Knowledge Comes Only From Experience

Vanguard Fan 1367
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Re: DAF for church offering? [Donor Advised Fund]

Post by Vanguard Fan 1367 » Fri Jul 26, 2019 9:18 am

My church seems to be happy with my Vanguard DAF offerings.

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FIREchief
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Re: DAF for church offering? [Donor Advised Fund]

Post by FIREchief » Fri Jul 26, 2019 2:22 pm

Vanguard Fan 1367 wrote:
Fri Jul 26, 2019 9:18 am
My church seems to be happy with my Vanguard DAF offerings.
I believe that most charities prefer this type of giving, as it is automatic and regular.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

stlutz
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Re: DAF for church offering? [Donor Advised Fund]

Post by stlutz » Fri Jul 26, 2019 5:23 pm

As somebody who has been a church treasurer, yes, you love even giving throughout the year. But that's overall, not for individuals. In general, summer is a problem--giving always goes down then but the expenses don't. If you are looking for a way to give once a year that your church will like, do that annual gift in the middle of the summer (today?)--it will actually make your church treasurer happy. :happy

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happymob
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Re: DAF for church offering?

Post by happymob » Fri Jul 26, 2019 7:14 pm

leonard wrote:
Mon Dec 26, 2016 4:34 pm
Why not just do a single donation a year and let the church manage the monthly budgeting out of the cash flow?

Way less admin for you.
Agree with this. Once a year should be easier for everyone, unless the church is really struggling with cash flow.

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calmaniac
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Re: DAF for church offering? [Donor Advised Fund]

Post by calmaniac » Fri Jul 26, 2019 9:10 pm

Rather than give $5k yearly to the donor advised fund, you will get more tax deductions by giving $10k every other year. With the 2017 tax law, standard deductions are increased, such that you don't get as much additional deduction by itemizing. By bunching your contributions every other year you will increase deductions. See alternating itemized/standard deductions to reduce fed tax? for discussion.

Also try Googling: bunching deductions

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FIREchief
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Re: DAF for church offering? [Donor Advised Fund]

Post by FIREchief » Fri Jul 26, 2019 10:31 pm

calmaniac wrote:
Fri Jul 26, 2019 9:10 pm
Rather than give $5k yearly to the donor advised fund, you will get more tax deductions by giving $10k every other year.
This is true in some cases, but the OP hasn't provided enough information to reach this conclusion. If OP is already beyond the standard deduction each year (before adding charitable donations), then it won't matter. Also, if OP is $10K below the standard deduction, it won't matter.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

GuyInFL
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Re: DAF for church offering?

Post by GuyInFL » Sat Jul 27, 2019 1:19 am

happymob wrote:
Fri Jul 26, 2019 7:14 pm
leonard wrote:
Mon Dec 26, 2016 4:34 pm
Why not just do a single donation a year and let the church manage the monthly budgeting out of the cash flow?

Way less admin for you.
Agree with this. Once a year should be easier for everyone, unless the church is really struggling with cash flow.
I do this quarterly with a Schwab DAF and it works well.

StealthRabbit
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Re: DAF for church offering? [Donor Advised Fund]

Post by StealthRabbit » Sat Jul 27, 2019 1:30 am

after contacting several of my charities, asking their preference, I use semi-annual disbursements from DAF (Based on what best fit their needs. Usually Mid May and Mid Nov.

Fidelity ($50 minimum + many more qualified charities) makes it easier than Vanguard ($500 minimum).

Both are very simple automated + managed investments and many times better and more responsible than my previous 20 yrs with DAF at local Community Foundation (They messed up a lot of my earmarked gifts), They much preferred to distribute "Their Way" (not uncommon with volunteer managed and run local foundations.)

I avoid gifting any 'tithe' or 'annual PERSONAL commitment' from DAF, as per DAF restrictions. (A DAF is a separate entity and CANNOT meet a personal pledge, as it could be construed as a 'benefit' to you personally. You can solve this problem by simply 'paying-your-own-freight' (on personal commitments), or... not committing to a written and enforceable personal annual pledge. That doesn't mean you don't give... :oops:
https://www.bakertilly.com/insights/ple ... -dont-mix/
https://www.irs.gov/charities-non-profi ... ised-funds
https://www.kitces.com/blog/rules-strat ... le-giving/

Remember... it is the Foundation that issues the donation, the receiving entity should be instructed to NOT personally thank the administrator / donee... only the DAF for contributing, and donee for recommending the contribution, but NOT GIVING it!

basspond
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Re: DAF for church offering? [Donor Advised Fund]

Post by basspond » Sat Jul 27, 2019 7:19 am

We prepay our tithes every other year to maximize our itemized deductions. Last year was the first year we did appreciated assets. Had a couple of hiccups for the transfer but in the end it was done very quickly.. Financial advisor didn’t charge us any fees since it was a transfer and not a sale.

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